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Custom House Capital wealth management firm look to raise €5m

An Irish wealth management firm is hoping to raise upwards of €5 million when it launches a new commodity bond in the coming weeks, writes Emma Kennedy.

Dublin-based firm Custom House Capital is launching its fourth capital protected commodity bond within the next few weeks. Sean Kenzie, associate director and head of equities at the wealth management firm, said it hoped to take in more than €5 million in investments upon the bond’s launch. He said about €2 million had already been committed by investors.

Investors will be required to commit to a minimum investment of €50,000, but their investment will have full capital protection under the terms of the investment.

A five-year investment term applies, with a 5 per cent upfront fee and no additional fees or charges thereafter.

The bond will expose investors to a variety of commodities, with the focus on ‘soft’ or agricultural commodities.

Some 80 per cent of the underlying assets behind the bond are agricultural, with corn, soybean, sugar, wheat, cotton, cocoa and livestock all featuring in the basket of assets behind the bond. The remaining 20 per cent will be split between industrial commodities, such as energy and metals.

Custom House Capital, which was set up in 1997, launched its first commodity bond in 2005.

Kenzie said it had focused on industrial commodities to date, but said the firm saw the relative value in agricultural commodities at the moment.

He said the five-year commodity bond launched in 2005 had locked in a 70 per cent return after its first two years.

©2008 Sunday Business Post