Investment management group Schroders plc has increased a stake it holds within various funds and mandates in the reinsurance and insurance linked securities (ILS) investment fund, the Blue Capital Global Reinsurance Fund, to over 10%.
Having passed a 10% threshold Schroders has to disclose the levels of shares held in the London and Bermuda stock exchange listed Blue Capital Global Reinsurance Fund both before and after it passed that trigger.
Prior to the transaction that triggered this reporting need on the 26th Nov, Schroders managed portfolios and funds held 17,124,314 shares in the Blue Capital listed ILS fund. It appears that Schroders portfolios acquired an additional 3,463,910 shares in the fund, taking the total holdings to 20,588,224, which is equivalent to a 10.34% indirect share of the fund voting rights.
The investments are held in portfolios or funds managed by Schroders owned entities on a discretionary basis for certain clients under investment management agreements.
The Blue Capital Global Reinsurance Fund is managed by Blue Capital Management Ltd., a subsidiary of Bermudian insurance and reinsurance firm Endurance. It invests in a range of collateralized reinsurance and insurance-linked securities (ILS) instruments, such as industry loss warranties (ILW’s) and catastrophe bonds.
Schroders is one of the largest asset managers in Europe, with around $450 billion of assets under management at the end of Q3 2015. The manager operates its own ILS and catastrophe bond investment strategies, but clearly also invests in this ILS fund which likely suits some client mandates.
The Blue Capital Global Reinsurance Fund is one of the few opportunities in ILS that can be easily accessed by more retail type investors due to its stock exchange listing and the liquidity that it provides. As a result it has proved popular with other asset managers looking to add an element of ILS and reinsurance to their portfolios, looking to benefit from the asset classes low correlation and stable returns over the long-term.