City Financial Investment Company, a UK headquartered independent asset manager which operates a range of traditional and alternative multi-strategy funds, has increased its holdings in the retrocession focused exchange-listed CATCo Reinsurance Opportunities Fund Ltd.
Displaying an increasing appetite for access to the retrocessional reinsurance fund, which is managed by Bermuda based CATCo Investment Management, has lifted its allocation to the fund to reach 10.29% of the outstanding shares.
Prior to the new allocation to the CATCo retrocession fund, which is spread across a number of strategies managed by City Financial, the investment firm held 24,518,750 shares. City Financial has added 3.6 million shares in the CATCo Reinsurance Opportunities Fund on the 1st October, taking its holdings to 28,118,750, which equates to the 10.29%.
The London and Bermuda stock exchange listed CATCo managed fund has proved popular with asset managers like City Financial, who tend to put their holdings within multi-asset class strategies that they run.
The low-correlation and attractive returns possible from reinsurance linked investments can make an ideal complement to other asset classes in any multi-strategy approach.
As a result there is an expectation that traditional multi-asset class investment managers will increasingly discover the reinsurance and insurance-linked securities (ILS) asset class, particularly when broader financial market volatility encourages them to look for new avenues to deploy capital into.