Sun, Apr 26, 2015
A A A
Welcome Guest
Free Trial RSS
Get FREE trial access to our award winning publications
Industry Updates

Dexion Capital launches insurance-linked closed-end fund

Monday, April 30, 2012

Ana Haurie
Opalesque Industry Update - Alternatives specialist Dexion Capital has announced the proposed listing of a new investment company, DCG IRIS Limited, on the London Stock Exchange.

Offer highlights include:

  • DCG IRIS Limited (the ‘Company’) is a proposed new London-listed, closed-end investment company seeking attractive returns from insurance linked strategies (‘ILS’). The IPO is scheduled to close mid June 2012
  • The Company will access a highly diversified portfolio of catastrophe risks with a target net return of LIBOR +5% to 7% and annual volatility of 2 to 4%, by investing in CS IRIS Low Volatility Plus Fund (the ‘Master Fund’), managed by Credit Suisse
  • The Company has an initial dividend target of 5% per annum, payable quarterly
  • ILS offers substantial diversification benefit with low correlation to financial markets and other alternative investment strategies
  • Strong discount controls
  • Credit Suisse manage a portfolio of catastrophe risks with unique risk/reward characteristics which typically involve synthetic triggers, reducing complexity and providing transparency so that losses can quickly be assessed more quickly and losses typically expected to arise only as a result of very large events
  • Publicly traded cat bonds may also be used, typically 10-30% of the portfolio
  • A high degree of portfolio diversification is provided through the range of uncorrelated catastrophe event exposures i.e. hurricanes, earthquakes, aviation, marine and typhoons
  • Transactions are collateralised by a highly-rated bank (currently AAA) and minimal credit risk is taken with insurance counterparties
  • The Credit Suisse ILS investment team has long track record in ILS, with US$3.7 billion in AUM (as of March 2012). It has a total of 24 fully dedicated employees
  • A presence in Zurich and London gives access to main reinsurance markets
  • The ILS team receives fully integrated support from Credit Suisse with independent control functions including risk management and compliance provided by Credit Suisse
Dexion Capital plc has been appointed sole financial adviser and placing agent to the Company. Dexion Capital Guernsey Limited (DCG) will be investment manager to the Company.

Ana Haurie, Group Managing Director of Dexion Capital said: “The catastrophe reinsurance market offers investors a diversified source of returns which are attractively priced at a time when traditional portfolio diversifiers such as government bonds and gold are fully priced with high potential risk. The experienced Credit Suisse ILS team are specialist risk managers with extensive knowledge of meteorology and insurance, and a long track record in this field. We believe that investors will quickly grasp the benefits of this opportunity with increasing numbers of institutions entering the space”.

Press release

bc

What do you think?

   Use "anonymous" as my name    |   Alert me via email on new comments   |   
Today's Exclusives Today's Other Voices More Exclusives
Previous Opalesque Exclusives                                  
More Other Voices
Previous Other Voices                                               
Access Alternative Market Briefing


  • Top Forwarded
  • Top Tracked
  • Top Searched
  1. U.S. does not want hedge funds to invest in offshore re-insurers for tax purposes[more]

    Komfie Manalo, Opalesque Asia: The U.S. Treasury Department on Thursday introduced a new rule aimed at limiting hedge funds’ ability to reduce their tax bills by investing in insurance companies in offshore tax havens. As a general rule, the U.S. tax laws does not allow hedge funds to use off

  2. Ruling: Hedge funds suing Argentina can have access to bond offering details[more]

    Komfie Manalo, Opalesque Asia: U.S. District Judge Thomas Griesa in Manhattan ruled yesterday that hedge funds are entitled to details of a recent bond offering by Buenos Aires, reports

  3. Fund managers express concern of overvaluation in both equity and bond markets[more]

    Komfie Manalo, Opalesque Asia: According to the BofA Merrill Lynch Fund Manager Survey, investors see growing overvaluations in both

  4. Update: Wall Street has strong feelings about Jon Corzine trying to make a comeback[more]

    From Businessinsider.com.au: Former New Jersey Governor Jon Corzine is thinking about starting his own hedge fund, according to the Wall Street Journal, and because of the way his last firm imploded, Wall Street has strong feelings about that. “Truth is the larger seeders would never give him money

  5. Opalesque Exclusive: Cybersecurity and hedge funds - A manager’s experience, Part Four[more]

    Benedicte Gravrand, Opalesque Geneva: Ruane, Cunniff and Goldfarb, Inc. used to have their own IT infrastructure. Todd Ruoff, Executive Vice President in charge of trading, operations and technology, was responsible for its maintenance. Then he started looking at outsourced providers a couple of

 

banner