Almost a year ago we wrote about a venture called Multi-Strat Re which was being launched in Bermuda to assist hedge fund managers to enter the reinsurance market with less friction, allowing investors and funds to outsource many of the necessary steps in launching and operating a reinsurance business.
Multi-Strat Re is an interesting strategy which could help both smaller hedge funds, or hedge funds who do not want to devote the time to establishing their own reinsurance vehicle and building experienced teams, to get into the reinsurance business and begin to profit from the investment capital it provides via the reinsurance float.
Recently, Opalesque TV interviewed Joe Taussig, the CEO of Multi-Strat Holdings Ltd., which owns Bermuda domiciled reinsurer Multi-Strat Re. Taussig explains in the video why hedge fund managers like to get into the reinsurance business, how the strategy works and how Multi-Strat aims to make the venture simpler for fund managers.
To date, Taussig said that Multi-Strat has three fund managers on the platform and it aims to add 2 to 4 new hedge fund managers per month to the platform by 2014 or 2015. Multi-Strat can help hedge fund managers seed a new reinsurer in 90 to 120 days for $100,000 in startup costs.