US bank JPMorgan has launched two commodity funds designed to exploit rises and falls in global commodity markets, tapping into the possibility that commodity markets are not destined to rise indefinitely. The funds are the JPMorgan Commodity-IGAR Conditional Long-Short Index Fund and the JPMorgan Commodity-IGAR Conditional Long-Short Index Capital Protected Fund. Their returns are based on an index derived from a mathematical programme that will take long or short positions on commodities, based on price momentum. JPMorgan’s index offers exposure to 24 segments from the Standard & Poor’s GSCI universe of commodities, ranging from wheat to crude oil. The index is rebalanced monthly according to a series of rules based on momentum. With the non-capital protected fund, at maturity investors get 160 per cent of any upside to the index and 100 per cent of the downside of the average performance of the index. On the capital-protected index, potential returns are capped at 200 per cent at strike. “These new funds enable investors to gain exposure to a diversified range of commodities through monthly dynamic rebalancing and should enable investors to make positive returns under a wide range of economic scenarios,” Jonathan Kent, executive director in Structured Investments Distributor Marketing UK, Ireland and South Africa at JPMorgan, said. The Irish-registered funds can be bought and sold across European Union borders under the EU's UCITS III regulations, which allow funds to make use of derivatives.