Catastrophe insurance fund announces $50 million cornerstone investment

16 August 2010

A new Australian onshore unit trust investing in catastrophe insurance, the Palmetto Australian Unit Trust, has opened this month with a $50 million initial investment from ipac Asset Management Limited.

Palmetto is managed by Nephila Capital, one of the world's biggest participants in the insurance-linked securities market. Nephila uses catastrophe bonds, industry loss warranties and reinsurance contracts to construct robust portfolios.

Nephila is based in Bermuda and is 25 percent owned by Man, one of the world's largest alternative investment managers.

Daphne van der Oord, of Man Australia's institutional team, said the unit trust had been established to give Australian institutions access to Nephila through an onshore vehicle.

"Nephila offers performance that is uncorrelated to traditional forms of investment," Ms van der Oord said. "Insurance-linked securities clearly are gaining broad acceptance from institutional investors and consultants. After the Global Financial Crisis, investors are seeking independent return streams. Catastrophe reinsurance certainly provides that portfolio benefit."

ipac Chief Investment Officer, Jeff Rogers, said the investment in Palmetto continues ipac's strategy of diversifying the economic drivers of return in its clients' portfolios.

"To be successful in this sector, you need expertise in risk management and the capacity to access a wide variety of insurance-linked exposures. Our research identified Nephila Capital as a strongly resourced manager well-positioned to deliver a portfolio offering an attractive trade-off between return prospects and risk," he said.

Over $200 million in Australian investments has been invested with Nephila Capital over the past year.

 

Enquiries

Jane Shelton
Institutional Business, Man Investments Australia
02 8259 9936 (dir. bus.) 0419 638 911 (mob.)
jshelton@maninvestments.com

About Nephila Capital
Nephila Capital Ltd is a leading investment manager specialising in the reinsurance industry with multiple investment strategies dedicated to investing in instruments such as insurance-linked securities, catastrophe bonds, insurance swaps, and weather derivatives.

The company has been managing institutional assets in this space since it was founded in 1998 and has over 30 team members all based in their Bermuda headquarters. In June 2008, Man Group plc, a leading alternative investment management firm, acquired a 25 percent interest in Nephila Capital.

About Man Group
Man is a world-leading alternative investment management business. With a broad range of funds for institutional and private investors globally, it is known for its performance, innovative product design and investor service. Man's funds under management at 30 June 2010 are US$38.5 billion.

The original business was founded in 1783. Today, Man Group plc is listed on the London Stock Exchange and is a member of the FTSE 100 Index with a market capitalisation of around £4 billion.

Man Group is a member of the Dow Jones Sustainability World Index and the FTSE4Good Index. Man also supports many awards, charities and initiatives around the world, including sponsorship of the Man Booker literary prizes. Further information can be found at www.mangroupplc.com.

If you are having difficulty viewing these Terms and conditions of use, please click here.

Terms and conditions of use

Please read this page before proceeding. It is your responsibility to be aware of and to observe all applicable laws and regulations of any relevant jurisdiction.

  1. Legal disclaimer

    The information on the Man Investments Australia Limited ("MIAL") website:

    • should not be distributed to any third party in whole or in part without the prior written consent of MIAL; and
    • has been obtained from sources believed to be accurate and MIAL does not give any representation or warranty as its reliability, accuracy or completeness.
  2. General advice

    The web site contains general information and does not purport to take into account any investor's particular financial circumstances. Man Investments Australia recommends that all potential investors seek independent financial, taxation and legal advice. To the maximum extent permitted by law, Man Investments Australia disclaims liability for any errors or omissions whether caused by the negligence of Man Investments Australia or otherwise. Man Investments Australia does not accept any legal responsibility for material published on third party linked sites. Past performance is not a reliable indicator of future performance.

  3. Description of website

    Access to and use of the maninvestments.com.au website (the "Site") and the materials found on it (the "Content"), including the investment products referred to on it (the "Investment Products") are subject to the following terms and conditions (these "Terms"). By clicking the confirmation at the bottom of these Terms, you signify that you have read, understood and accepted these Terms. MIAL may update, revise, delete or modify information on this Site without notice. Information should only be considered current as of the time of initial publication on this Site or as otherwise stated on this Site without regard to the date on which you may access the information.

  4. Restricted access

    This Site, the Content and the Investment Products are not directed at or intended for distribution to any person (or entity) who is a citizen or resident of (or located or established in) any jurisdiction where the use of the Site (or the purchase or sale of the Investment Products) would be contrary to applicable law or regulation or would subject Man to any additional registration or licensing requirement in such jurisdiction.

  5. No offer

    The Content is provided for information purposes only and does not constitute a solicitation or offer, or advice or recommendation, to buy or sell interests in any Investment Products, to effect any transactions, or to conclude any transaction of any kind whatsoever. Potential investors should read the terms and conditions in the relevant offering materials carefully before any investment decision is made.

  6. Monitoring by MIAL

    Your use of the services on this Site may be monitored by MIAL, and the resultant information may be used by MIAL or its affiliates for its internal business purposes or in accordance with the rules of any applicable regulatory or self-regulatory organisation.

  7. No warranties and exclusion of liability

    Whilst MIAL shall use reasonable efforts to obtain information from sources which we believe to be reliable, MIAL gives no warranty as to the accuracy, completeness or reliability of any information, opinions or forecasts contained on the Site, nor does it undertake to ensure that this Site will be available or accessible at all times. MIAL shall have no liability (whether in contract, tort or otherwise) for any direct, indirect, consequential or special losses or damages of any kind whatsoever arising from or in connection with the access to, use of or linking to other websites ("Linked Websites") from this Site or any reliance on any of the Content. MIAL is not responsible for the content of any Linked Websites and accordingly accepts no liability with respect thereto or for any reliance placed upon such Linked Websites. MIAL is not liable for persons or matters beyond its reasonable control (such as telephone and other communications networks, the internet or your internet service provider). These exclusions of liability do not apply to the extent that such exclusions are invalid or ineffective under any law or regulation applicable to MIAL.

  8. Investment Performance

    Potential investors should note that investments can involve significant risks and the value of an investment may go down as well as up. The Investment Products on this Site typically use alternative investment strategies and may invest in derivatives of any kind. The prices of futures, options and other instruments in which the products may invest may fall in value as rapidly as they may rise and it may not be possible to liquidate the positions in the relevant markets before a loss is sustained. Price fluctuations may be substantial because of leverage. No assurance can be given that the investment objective of any Investment Product will be achieved or that substantial losses will not be suffered. There is no guarantee of trading performance and past or projected performance is not necessarily a guide to future results. Movements in exchange rates between currencies may affect the value of an investment.

  9. No Reliance

    Nothing contained on this Site constitutes investment, legal, tax or other advice or a recommendation to purchase or sell any investment. You should not rely on any of the Content in making an investment or other decision but should obtain relevant and specific professional advice and read the terms and conditions contained in the relevant offering prospectus carefully before any investment decision is made.

  10. Material Interests

    Any one of MIAL or its affiliates or their directors, officers, employees, agents or representatives may have or have had an interest or holding, relationship or other arrangement with the Investment Products which may be material. Potential investors should refer to the applicable offering documents for any Investment Product and in particular, the potential conflicts of interest discussed therein.

  11. Financial Services Guide

    Click here to access a copy of MIAL's Financial Services Guide.

By clicking "I ACCEPT" below, you confirm that you have read and understood the Terms above and agree to be bound by them.

I AcceptI Do Not Accept