Press Release: Five Years Plenum CAT Bond Dynamic Fund: A Success Story
Launched in 2021 as a UCITS fund, the Plenum CAT Bond Dynamic Fund invests exclusively in catastrophe bonds (CAT bonds) and money market instruments. The investment strategy aims to generate attractive excess returns while maintaining tail-risk characteristics comparable to the broader market. The growth of assets under management to approximately USD 600 million underscores the success of the fund’s efficiency-oriented investment approach.
Dirk Schmelzer, Head Portfolio Manager ILS/CAT Bonds and Partner at Plenum Investments AG, comments: “The growth of our fund can be attributed to several factors: the ongoing search for attractive yields, the fund’s very strong performance over the past five years, significantly increased geopolitical and trade policy risks, as well as the growing awareness of CAT bonds among a broader range of investors. At the same time, a new trend is emerging within the CAT bond fund market. Despite sharply rising demand, large CAT bond funds have recorded only limited growth this year, whereas mid-sized funds are experiencing above-average growth and increasingly benefiting from superior performance. The market appears to be recognizing that selectively managed funds can provide meaningful added value.”
David Strasser, Senior Portfolio Manager responsible for modelling, adds: “Investors are increasingly recognizing that fund size is a critical success factor in the CAT bond market and that assets under management must be aligned with the capacity constraints of this specialized asset class. The Plenum CAT Bond Dynamic Fund is positioned as a focused investment fund in the high-yield CAT bond segment and responds to the increasing capacity constraints faced by some UCITS funds in this market. “
Dirk Schmelzer further explains: “Quality through risk selection is our investment focus and not simply reflecting the CAT bond market. That’s why we invest in granular, independent risks in the US wind segment. CAT bonds that are exposed to secondary risks and that aggregate damage over a certain period are reduced to a minimum. This approach allows us to achieve a high level of diversification within the fund while still expressing our investment convictions and selecting positions with attractive risk-adjusted returns and low correlation.”
The Plenum CAT Bond Dynamic Fund therefore combines what many investors seek: consistently low correlations alongside attractive return opportunities. The reference currency of the fund is USD. Currency-hedged share classes are available in CHF, EUR and GBP. In addition, the fund is classified as Article 8 under the European Sustainable Finance Disclosure Regulation (SFDR).
We would like to sincerely thank our investors for their continued trust and long-standing loyalty. For further information, please contact the representatives listed below.
Kind regards,
Your Plenum-Team
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