Listed Insurance Risk Fund Shoots For 12% Annual Returns

Insurance-linked securities are coming to the London Stock Exchange. Securis Investment Partners LLP, according to Reuters, is interested in listing a closed-end investment company in order to gain access to investors. The company would consist of a portfolio of insurance-linked securities – i.e., investment vehicles used to facilitate the trading of insurance risks.

Reuters notes:

The new vehicle, Securis Income Fund Limited, will be a closed-end, Guernsey-incorporated investment company, and will become a feeder fund for the firm’s flagship ILS Securis I Master Fund, the company said on Monday.

So, what kind of returns are possible? Reuters reports that the Securis I fund, launched five years ago, has been good for an 11.6 per cent return from October 2005 to January 2011. It focused on catastrophe bonds and longevity and mortality risk. The new fund has a total return target of 12 per cent a year and the goal is to pay a 6 per cent gross dividend every year.

Source: Thomson Reuters Insurance Linked Securities (registration required)

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