Andy Pfaff, CEO at Coherent Capital Management, on their Coherent Global Commodity Investment portfolio.
SIMON BROWN: I’m chatting now with Andy Pfaff, CEO at Coherent Capital Management, talking about their Coherent Global Commodity Investment portfolio. It’s an actively managed certificate. AMC CCMGCZ is the code. Andy, I appreciate the time. This AMC – we are talking here commodities. You’re not looking at miners. You want the raw commodities in this particular AMC.
ANDY PFAFF: Yes. Three sectors. It’s just like equities. Equities have got financials and industrials and resources. Commodities have got similar sectors. They’ve got agriculture, energy and metals, and the drivers are quite different. Agriculture is typically driven by weather; energy more by politics if you think about Opec; and then metals, obviously base metals, averages, but they’re driven more by economics. But they’re quite diverse drivers. And to lead to that diversification ….
So we play a lot of absolute returns, high risk management profiles to our portfolios. Yes. We don’t track the basket; we don’t track the index. We can go from zero to 100% exposure. And it varies quite a lot as well.SIMON BROWN: I’ve got you then. And this is a long-only. You are not taking short positions. You’re using, I imagine in some cases maybe derivative products, but it is a long-only portfolio.
ANDY PFAFF: There are sort of throw away comments. One is trade what you see, not what you think, because you never have all the answers; you never have all information. We’ve got a very good – I think everyone is subjective. Everyone has their own version of how to choose trades. But you need to have an objective method of saying, hey, I was wrong. I’m closing the position. And that’s what we do.
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