The ILS market, which includes catastrophe bonds and collateralized reinsurance contracts, was born out of insurers' and reinsurers' need for additional protection. Launched in August 2011, the Atropos fund aims to deliver annual absolute returns of between 6% and 8%, with monthly liquidity.
Since the beginning of 2020, Atropos has delivered a performance of +6.29% and has recorded gross inflows of more than USD 140 million. Gross inflows for the entire fund range, which also includes a fund solely invested in natural catastrophe bonds - Atropos Catbond - stand at more than USD 200 million.
Focusing on transactions with clearly defined, limited and modellable risks gives these ILS strategies a strong capacity for shock absorption in the event of a natural catastrophe. This approach has been particularly resilient in a market heavily impacted by a succession of major natural catastrophes in 2017, 2018 and 2019. The Atropos fund provided continued liquidities over this period, delivering a net performance of +5.78%, in contrast to the -7.34% performance of the Eurekahedge ILS Advisors index.
Olivier Nolland, Global Head of Client Solutions and member of the SCOR Investment Partners management board, stated:
"We are proud that the assets under management for the Atropos fund, which was the first strategy we offered to third-party investors, have exceeded the USD 1 billion mark. During the current global health and economic crisis, the Atropos fund offers investors a source of diversification and decorrelated returns. This success confirms that our positioning on diversification strategies has been very well received by institutional investors."
Sidney Rostan, Head of ILS at SCOR Investment Partners, commented:
"These past few challenging years on the ILS market have enabled investors to compare investment strategies. Our approach - to select contracts with returns we consider appropriate for the risks covered and to construct portfolios with a strong capacity for shock absorption - has demonstrated its strength. This strong resilience indicates the aptness of our approach, which combines risk profile consistency and adjustment to emerging market dynamics."