Investment supervisor Amundi US has celebrated the one 12 months anniversary of its latest devoted mutual insurance-linked securities (ILS) fund technique, the Pioneer Cat Bond Fund, saying that the technique has now surpassed $150 million of property and delivered a 1-year return of over 14.9%.
The funding supervisor has been steadily building its property below the administration within the fund, to enhance its different insurance-linked securities (ILS) providing, the Pioneer ILS Interval Fund, which allocates to quota share reinsurance preparations, reinsurance sidecars and personal collateralized reinsurance offers.
When we final lined the technique, the Pioneer CAT Bond Fund had reached $84.2 million in property, as at October thirty first 2023, whereas delivering an 11.20% web asset worth (NAV) return from its launch by way of to that date.
The first anniversary of the Pioneer CAT Bond Fund was on January twenty sixth 2024 and the supervisor mentioned it “marked its first year with a return of 14.64%,” since inception, whereas by the tip of that month “the Fund had over $150 million in assets under management.”
Chin Liu, Director of Insurance-Linked Securities, Director of Fixed Income Solutions, and Portfolio Manager of the Pioneer CAT Bond Fund, commented, “Pioneer CAT Bond Fund leverages our agency’s 16-year historical past of investing in insurance-linked securities, and we proceed to consider this asset class is a beautiful choice for buyers on the lookout for potential sources of yield and return.
“CAT bonds have historically exhibited low return correlations to equity and fixed income markets, offering valuable portfolio allocation and diversification benefits.”
Liu additionally commented on market situations in reinsurance and for ILS investing, which the funding supervisor believes stay enticing.
He defined, “Many of the favorable market trends that we witnessed over the past few years, including more demand from the insurance industry for capital relief and elevated spreads of ILS securities, are still firmly in place.”
Jonathan Duensing, Head of Fixed Income, US, at Amundi US, additionally mentioned, “We have been happy with the market’s reception for this technique in its first 12 months.
“The Fund’s asset growth confirms that investors share our view about the potential benefits of this market segment. Investments in insurance-linked securities are a long-standing core competency of our fixed-income team.”
For the Pioneer CAT Bond Fund’s Class Y shares, the 1-year complete return reached 14.93% as of January thirty first 2024.
Amundi US had round $2 billion of ILS property below administration throughout its devoted ILS mutual funds and multi-asset class methods, as of the start of this 12 months.
