Schroder Investment Management

The Artemis Insurance-Linked Securities Investment Managers & Funds Directory is a one-stop resource for information on insurance or reinsurance linked investment managers and their ILS fund strategies.

Schroder Investment Management - Snapshot:

  • ILS manager or company name: Schroder Investment Management
  • Location (HQ / Domicile): London
  • Date of launch: Jun 2008
  • Assets under management: $3.040 billion (As at December 2017)
  • Website link: Schroder Investment Management website

Schroder Investment Management - Details

Company profile:

The ILS team at Schroders boasts strong insurance industry expertise including an experienced team in modelling and underwriting. The first fund was launched in 2008 and our assets are now just over USD 3 billion in January 2018.

As a global investment manager, we help institutions, intermediaries and individuals across the planet meet their goals, fulfil their ambitions, and prepare for the future. But as the world changes, so do our clients’ needs. That’s why we have a long history of adapting to suit the times and keeping our focus on what matters most to our clients.

Doing this takes experience and expertise. We bring together people and data to spot the trends that will shape the future. This provides a unique perspective which allows us to always invest with conviction. We are responsible for £418.2 billion (€476.3 billion/$543.3 billion)* of assets for our clients who trust us to deliver sustainable returns. We remain determined to build future prosperity for them, and for all of society. Today, we have 4,100 people across six continents who focus on doing just this.

Team size and structure:
21 employees involved in portfolio management, underwriting, modelling and structuring are dedicated to ILS. The team is further supported by two cat bond traders.
Number of strategies (how many funds, sidecars or strategies):

Our ILS offering includes 4 strategies across 6 pooled funds and several segregated accounts.

Offers private managed accounts?

Yes

Other offices or locations:

The ILS team are based in our Zurich office, but we work together closely with various teams in our London and Luxembourg offices.

Strategy:

The breadth and depth of the ILS team allows us to build an offering that is probably unique in its ability to source and model risk on a very broad spectrum. Furthermore, we are among the most active managers within the universe, in particular for cat bond trading, providing us with great market access. This insurance competency combined with Schroders’ experience as an asset manager allows us to deliver a best in class ILS offering from tradeable cat bonds to broader and less liquid universe of ILS.

The Schroders platform provides all the services you would expect from one of UK’s largest asset manager: independent risk management, around-the-clock trading capabilities, operational services as well as legal & compliance to mention just a few. Our investment philosophy consists of picking risks which we can understand and model; and which provide sufficiently high returns for the selected transactions. We build our portfolios with a balanced profile enabling us to deliver attractive performance while containing our tail risk. Diversification, decorrelation and yield combined with insurance industry experience and renowned asset management is what a Schroders ILS funds/solutions brings to your portfolio.

Schroder GAIA Cat Bond

The fund will invest in insurance-linked securities, mainly in catastrophe bonds. The fund will focus on the insurance risk of natural catastrophes such as hurricanes and earthquakes affecting regions such as Western Europe, Japan and the USA where people generally buy insurance.

The fund will diversify its investments by peril (e.g. wind, earthquake), geography and season (some risks vary with the time of year) but will have a bias toward hurricane and earthquake risks in the USA, which form the greater part of the cat bond market.

The fund aims to make investments which do not depend for their value on the economic cycle; they depend instead on the occurrence and severity of natural events. Derivatives are currently used for currency hedging only, although we have the flexibility to use interest rate futures if needed to ensure that interest rate sensitivity remains very low.

Type of investment strategy (fund, sidecar etc):

Cat Bond Strategy

Launch date:

May, 2011

Latest AuM:

$749 million

Underlying asset types:

97% invested, 3% cash

Target return:

3m Libor + 6% p.a. net of fees

Annualised return:

Annualised return 6.90% p.a. from 31-7-2011 to 31-10-2014. Performance for I USD share class gross of management fee.

Best monthly return:

1.7%

Return since inception:

24.25%

Percent positive months:

94.7%

2013 return:

7.15%

2012 return:

8.30%

SIF Core Insurance Linked Securities

To provide a total return primarily through investment in a diversified portfolio of insurance linked securities, which provide exposure to on-life insurance risks. The Sub-Fund will invest in instruments that are exposed to high-severity, low-probability catastrophe risks.

These instruments will mainly be catastrophe bonds, insurance-linked notes, investments in collateralised reinsurance contracts or over-the-counter financial derivatives with (re)insurance risk instruments as the underlying assets. Cash and cash-equivalent instruments will be used to manage liquidity in the Sub-Fund to meet redemptions.
Financial derivative instruments, including, but not limited to futures, forwards and swaps may also be used to hedge insurance, interest and currency risk.

Type of investment strategy (fund, sidecar etc):

Broad catastrophe strategy, investing both in cat bonds and coll re

Launch date:

September, 2013

Latest AuM:

$285.3 million

Underlying asset types:

99.4% invested, 0.6% cash

Target return:

3m Libor + 6-9% p.a. net of fees

Annualised return:

Annualised return 8.33% from 30-9-2013 to 1-11-2014 for I USD share class gross of fees

Best monthly return:

1.0%

Return since inception:

9.03% from 30-9-2013 to 1-11-2014 for I USD share class gross of fees

Percent positive months:

100%

Secquaero ILS Fund Ltd

The Secquaero ILS Fund aims to achieve absolute returns through investing (via its Master Fund) in a broadly diversified portfolio of assets that carry exposure to insurance risks, particularly, insurance linked securities (ILS).

The fund thereby seeks to generate its returns with a low correlation to traditional assets, such as fixed income securities or equities, as well as non-traditional investments.

The fund intends to build a bias towards portfolio based securitizations where frequency and not severity is the value driver, though it will also invest into high severity/low frequency perils (e.g. catastrophe bonds). Life risk related investments will play a significant role in the portfolio.
The portfolio will be actively managed and can make use of financial leverage. The fund is not an insurance company and risks are only assumed indirectly.

Type of investment strategy (fund, sidecar etc):

All-ILS strategy

Launch date:

May, 2008

Latest AuM:

$131.2 million

Underlying asset types:

109.0%

Target return:

3m Libor + 6-9% p.a. net of fees

Annualised return:

Annualised return 6.23% from 2-06-2008 to 31-10-2014. Performance for Basic USD share class net of 1.50% fee and 15% performance fee prior to 31-12- 2013

Best monthly return:

1.8%

Return since inception:

6.3%

Percent positive months:

93.8%

2013 return:

6.0%

2012 return:

6.2%

2011 return:

3.4%

Disclaimer:

The Artemis Insurance-Linked Securities Investment Managers & Funds Directory is provided as-is. Best efforts are made to ensure the contents are accurate at the time of publication but there may be some omissions. Please contact Artemis should you require a change to your listing.

For Professional Investors or Advisors Only.

This document does not constitute an offer to anyone, or a solicitation by anyone, to subscribe for shares. Nothing in this document should be construed as advice and is therefore not a recommendation to buy or sell shares.

Past performance is not a reliable indicator of future results, prices may fall as well as rise and investors may not get back the amount originally invested.

This document may not be distributed to any unauthorised persons.

The fund invests in securities that assume insurance-related risks. The occurrence of an insured event may lead to partial or full loss of the principal invested. Therefore the capital is not guaranteed and may decrease. Deposits with financial institutions may be subject to price fluctuation or default by the issuer.
Some of the amounts deposited may not be returned to the fund. Some investments denominated in a currency other than that of the share-class may not be hedged. The market movements between those currencies will impact the performance.

Third party data is owned or licensed by the data provider and may not be reproduced or extracted and used for any other purpose without the data provider’s consent.
Third party data is provided without any warranties of any kind. The data provider and issuer of the document shall have no liability in connection with the third party data. The Prospectus and/or www.schroders.ch contains additional disclaimers which apply to the third party data.

Schroders has expressed its own views and opinions in this document and these may change.

This document is issued by Schroder Investment Management (Switzerland) AG, Central 2 CH-8001 Zurich.




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