Trading places

If you're a bond investor, the threat of rising interest rates looms large.

John Milne isn't waiting around for rising rates to whack the value of bonds he manages for his institutional clients. The CEO of JKMilne Asset Management in Fort Myers says a search for assets with zero correlation to swings in interest rates and bond values led him to invest in perishable commodities such as cotton, grain, coffee, milk and meats. In addition, the firm bought a stake in Chicago commodity management firm Triumph Alternatives last year.

It's a bold but calculated move. “There isn't a track record, but we don't want to sit here a couple years from now and say we did nothing,” Milne says.