Cat bonds 'still attractive' despite volatility; Twelve Capital UCITS reaches $1bn

Zurich-based independent insurance investment manager  Twelve Capital's UCITS catastrophe bond fund has reached $1 billion in assets under management since its launch three years ago. The insurance-linked securities (ILS) fund manager now manages close to $2 billion overall in its cat bond strategy.

UCITS, also known as ‘undertakings for the collective investment in transferable securities’ are investment funds regulated by the European Union and intended to create a barrier-free market for collective investment funds.

The company said that the cat bond sector has remained attractive during the general market volatility in 2020, and it expects further growth in the coming months.

Urs Ramseier, CEO and co-founder of Twelve Capital, said: “The Cat Bond UCITS offering has always been a cornerstone of our product range. Twelve is continuously investing to further improve its investment process and extend its knowledge on relevant topics, such as climate change or ESG. The performance achieved across products in different market phases highlights the benefit of investing across an insurer’s balance sheet, as it enables the identification of industry trends early on.”

Florian Steiger, the portfolio manager responsible for Twelve Capital’s cat bond strategy, added: “During the general market volatility in 2020, Cat Bonds have again proven the benefit of investing into an asset class that exhibits only minimal correlation to equity or credit markets.

“As spreads are still attractive, we expect further growth of the Cat Bond strategy in the coming months.”

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