Stockholm (HedgeNordic) – Ress Life Investments A/S recorded a performance of 5.7% in May. The fund, managed by Stockholm based AIF manager Resscapital, invests in the secondary market for US life insurance policies with the aim to provide high single-digit returns which are uncorrelated to most other asset classes. In other words, the fund provides consumers with life insurance policies they no longer need, a way to terminate their obligation to pay premiums while recovering a higher value from their policy then they would obtain from the insurance itself. The investment strategy relies on actuarial models and longevity statistics to calculate expected returns, thereby estimating the current value of the policies.
Anton Pozine (pictured) who is in charge of portfolio management comments on last month’s positive performance: “As the number of longevity contingent assets increases in our portfolio, so does the predictability of policy pay-outs. By assembling a well-diversified portfolio, we are able to provide attractive risk adjusted returns”.
Resscapital has set its annual target return to 7% in USD for Ress Life Investments. “In today’s market it’s very difficult to find assets that provide uncorrelated absolute returns. A life insurance portfolio offers alternative fixed income returns and real risk diversification,” states Jonas Martenson, founder of the company. The portfolio is diversified across over 50 highly rated US life insurance companies, such as MetLife, AXA or Transamerica, for example. Spreading the risk accross many stable insurance companies significantly reduces the risk of default, when the policy is due. Other risks related to the strategy such as longevity risk or transaction risk are unlikely to be influenced by market risks. As the policies are expected to be held to maturity, the results are expected to remain decorrelated from the market.
SOURCE: HedgeNordic
Read full article here: hedgenordic.com/2018/06/may-flowers-for-life-insurance-policy-strategy
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Ress Life Investments A/S purchases US life insurance policies in the secondary market. The company owns a diversified portfolio and policies are issued by over 50 highly rated US life insurance companies. The investment objective is to provide attractive uncorrelated returns in USD over the long-term. Ress Life Investments is listed at Nasdaq Copenhagen since 2015.
Attractive risk-adjusted return – the target return is 7% per annum in USD without any leverage.
Low volatility – a well-diversified life insurance portfolio offers investors stable and attractive risk-adjusted returns. Monthly historical volatility since 2011 is 3.5%.
Risk diversification – the return profile of the life insurance portfolio is characterised by low correlation to other asset classes, which makes the strategy attractive for investors seeking risk diversification.
Exchange-traded – the company is listed and a market-maker provides daily prices.
Ress Life Investments A/S is a limited liability company incorporated in Denmark. The company is an alternative investment fund (AIF) managed by Resscapital AB, a limited liability company incorporated in Sweden. Resscapital AB is authorised as an alternative investment fund manager (AIFM) and supervised by Finansinspektionen, the Swedish Financial Supervisory Authority.
The depositary for Ress Life Investments A/S is Nykredit Bank A/S. The administrator is Citco Denmark ApS, which is part of the Citco Group. The independent board consists of three members with extensive experience from the financial markets. Ress Life Investments A/S is audited annually by Deloitte.
Ress Life Investments A/S is admitted to trading and official listing on Nasdaq Copenhagen. The company’s short name is RLAINV, ISIN DK0060315604. Current prices can be found under the segment – Alternative Investment Funds on NasdaqOMXNordic.
Danish retail investors and professional investors, as defined by the European Union’s MIFID directive, may also subscribe for shares on a monthly basis at the company’s current net asset value per share.
