The DCG Iris insurance-linked securities fund, a London Stock Exchange listed closed end ILS investment fund operated by investment manager Dexion Capital, has released some figures on its progress in recent months. The fund launched in June 2012, raising just over $40m to begin with and followed that by adding another 11m shares in late 2013 taking its total insurance-linked assets under management to around $51m.
The DCG Iris fund has a target net return of Libor + 5% to 7%. The fund suffered some uncertainty after hurricane Sandy as the master fund it invests its assets in, the Credit Suisse managed CS IRIS Low Volatility Plus Fund, decided to establish side-pockets for potential Sandy losses. Now, much of the Sandy uncertainty has been removed and DCG Iris is only exposed to four investments which remain in a side-pocket of the CS Iris fund.
So it seems a good time for the investment manager to have published an update on its progress in recent months and for us to compare its progress with its stated target return ambitions.
Earlier this week DCG Iris published an interim management statement which shows the net asset value performance from the 1st December 2012 to 12th April 2013 as +2.39% and an annualised NAV total return of 5.55%. In the funds latest estimated NAV report published today it says that the estimated return to date in 2013 is 1.89%.
We can compare the return to date in 2013 of 1.89% with the average return across 29 different ILS investment funds using the ILS Advisers Index. The ILS Advisers Index shows a 2013 return so far of 2.08% so DCG IRIS, which aims to be lower volatility than many ILS managers strategies is roughly comparable which must be encouraging for the investment managers at DCG Iris.
These numbers are all firmly within the return target range stated by DCG Iris and show that it is a case of so far so good for the DCG Iris ILS fund despite the uncertainty caused by hurricane Sandy.
We wrote about DCG Iris earlier this week in this article on another independent UK asset manager increasing its stake in the ILS fund.