Last month we wrote about another of the UK’s independent asset managers which had increased its allocation to reinsurance and catastrophe risk through one of the ILS and reinsurance funds we cover regularly here on Artemis. Premier Fund Managers, a UK investment manager offering a range of fund based investments to private clients and professional advisers, had grown its stake in the DCG Iris ILS and catastrophe bond investment fund.
When we wrote last month, Premier Fund Managers had increased its stake in the Dexion Capital managed DCG Iris fund from around 3.5m shares at the start of March to just over 4.3m shares as of the 26th March. That brought its stake in the fund to 8.42%, a holding which at the time was worth around £4.3m.
Premier Fund Managers clearly appreciate the return profile of catastrophe risk and increased its stake in DCG Iris by another 300,000 shares on the 12th April, bringing its holding in the ILS fund to just over 4.6m shares or a 9% stake. That equates to a holding in DCG Iris worth around £4.625m at todays share price.
We’re seeing news of these large independent asset managers either starting to deploy capital into catastrophe risk and reinsurance or increasing their allocations to the sector on an increasingly regular basis, which further demonstrates the attractiveness of the asset class to a growing group of investors. It’s also helping retail investors to gain exposure to reinsurance returns via these independent fund managers alternative fund offerings, which tends to be where the allocations to catastrophe risk reside.
Premier Fund Managers are not the first to up its allocations to reinsurance and catastrophe risk. A number of asset managers, including Cazenove Capital Management, hold allocations to CATCo. UK-based investment manager Baillie Gifford took up 10% of the Blue Capital Global Reinsurance Fund at its launch and also invested in CATCo at its launch as well. Another UK investment manager, F&C Asset Management also has a considerable allocation to Blue Capital.