Barclays launches new commodities protected investment

Barclays Wealth is launching a new issue of its Commodity Select protected investment, which offers access to a highly diversified range of individual commodities supported by full capital protection. This is the third issue in the Commodity Select series.

Open from 1 October to 28 November, Commodity Select is a five-year investment providing exposure to a range of the commodities Barclays Wealth believes will deliver strong returns within a diversified basket over the coming years. Broadly based on the standard S&P GSCI index suite, the basket provides exposure to the four sub-asset classes of energy, agriculture, base and precious metals, and direct access to commodities including corn, wheat and soybeans.

Investors receive 100 per cent of the performance of the basket with a maximum return of 100 per cent. Returns are subject to capital gains tax unless held within an ISA. Capital will be repaid in full at maturity regardless of basket performance. For full product details visit barclaysinvestors.com/ifa

Colin Dickie, director, Barclays Wealth, says: "Developing economies continue to increase demand for commodities but supply, particularly for energy products, is restricted in some areas. This should generate robust valuations but the volatility associated with certain commodities makes a strong case for a diversified approach.

"Commodity Select offers retail investors both diversification and access to commodities they might not be able to invest in otherwise. The weighting of the basket is supported by a strong investment rationale and provides a more sophisticated method of gaining exposure to commodities than through investing in an index. Commodities offer diversification away from equities and bonds and can be viewed as an inflation hedge for investors given the correlation between high street prices and commodity prices. With commodity prices falling back to early 2008 levels, this could represent a new buying opportunity, but investor concerns at this present time will mean that the capital protection feature will be an important consideration in the investment decision making process."