Mid-sized cat bond funds suffer asset declines as steep as 35% in 2022

Twelve Capital Cat Bond Fund led major pure play cat bond funds in asset growth in 2022, ending the year with $2.14 billion in its portfolio, a $470.9 million or 28% gain for the year, a dataset compiled by Plenum Investments indicates. The gain helped overcome major losses noted amongst mid-sized players to secure a slight overall increase in AuM for the group of funds tracked by Plenum.

The youngest of the three funds now sporting AuM in excess of $2 billion, launched in February 2018, the Twelve Capital fund was top three in AuM within two years and has since cut 71% of the gap to the market leader GAM Star CAT Bond Fund, now with $2.52 billion in AuM, a $50.41 million or 2.04% gain.

The market's #2, Schroder GAIA Cat Bond Fund, suffered a mild 1.9% or $45.06 million cut in AuM in 2022 to $2.30 billion.

Smaller funds chiefly suffered asset declines, occasionally dramatic. Leadenhall UCITS ILS Fund fell from fourth to sixth place over the course of 2022 on a 35% or $180 million decline in AuM.  Mark the Securis Catastrophe Bond Fund down 19.5%, the LGT LUX I CAT Bond Fund down 18% and AXA IM WAVe Cat Bonds Fund down nearly 15%, Plenum noted of funds with AuM in excess of the $100 million mark.

The market's youngest pure play cat bond funds continue to grow. Plenum CAT Bond Dynamic Fund, launched in June 2021, gained 73% in 2022 and is up 120% since inception. HSZ Group Funds Maneki UCITS Cat Bond Fund launched in March 2022 on $24.2 million and has added a modest $1.76 million in the meantime.

For the fifteen active funds Plenum incorporates into its market pricing indexes, mark AuM $103.65 million on the strength of the Twelve Capital gain, a 1.2% annual increase for the group.

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