Eurekahedge and ILS Advisers launch new USD hedged index
SINGAPORE (February 20, 2014) – In 2012, Eurekahedge, a market leading alternative fund data provider, launched a new hedge fund index focusing on insurance linked securities (ILS), in partnership with ILS Advisers. Two years after the successful launch of the ‘Eurekahedge ILS Advisers Index’; the first index tracking the performance of 32 funds investing exclusively in insurance risk, Eurekahedge together with ILS Advisers announced today the release of a USD hedged version of the benchmark.
The index was incepted in December 2005 and has returned 71.27% through January 2014. The index has an annualised return of 6.88% and an extremely low volatility, producing one of the highest Sharpe ratios of all of Eurekahedge indices at 2.17. The index boasts an impressive risk-reward profile in comparison to alternative investment vehicles and other asset classes as illustrated in the figure below.
Since its inception, the ‘Eurekahedge ILS Advisers Index’ has experienced an increasing acceptance by ILS investors, ILS funds, consultants and advisers, as a representative and fair benchmark for the asset class of insurance linked securities.
The year 2013 marked a new record for the asset class, as the total value of outstanding catastrophe (CAT) bonds passed US$20 billion for the first time. The asset class on insurance linked investing has been rapidly gaining traction among professional investors as an avenue of diversification due to its non-correlation to traditional and alternative asset classes and its stable and attractive performance – especially as an alternative to fixed income investments in the low interest rate environment.
The index can be found at:
About the index
The Eurekahedge ILS Advisers Index is an equally weighted index of hedge funds that explicitly allocate to insurance linked investments and have at least 70% of their portfolio invested in non-life risk. The new USD hedge version of the index is base weighted at 100 in December 2005 and has returned 7.18% per annum with a volatility of 2.30% until the end of 2013. The Eurekahedge ILS Advisers USD Hedged Index utilises the month end FX spot rates and factors in the hedging cost for all non-USD denominated index constituents.
How insurance linked securities work
Insurance linked securities (ILS) also known as catastrophe or cat bonds are a transfer of insurance risk to the capital markets typically by insurance or reinsurance companies. The performance of ILS depends on the occurence respectively non-occurrence of an insured event. ILS show a low correlation with traditional asset classes and other alternative investment. ILS are typically not exposed to duration risk or interest rate risk since their return consists of a variable interest rate component plus an insurance premium for the risk assumed. Moreover they protect investors against inflation. Typically the ILS funds diversify their exposure across different perils such as natural catastrophe (wind, earthquake), man made risk and across different geographies US, Europe and Asia.
About ILS Advisers
ILS Advisers was founded in Hong Kong by Stefan K. Kräuchi and Hansrudolf Schmid in 2011 as part of HSZ (Hong Kong) Ltd. an independent asset manager regulated by the SFC. The two founders combine over 40 years of industry and management experience on top level of major financial institutions.
The purpose of ILS Advisers is to develop the Asian market for Insurance Linked Investments. ILS Advisers are strictly an independent investment consultant with an exclusive focus on investing in insurance linked securities.
ILS Advisers identify and monitor the best ILS managers and products globally and bring them to professional investors.. ILS Advisers help clients to understand the asset class, support them in their selection and investment process and provide ongoing services once the investments are made. Target clients are institutional investors such as Sovereign Wealth Funds (SWF), Pension Funds, Banks, Family Offices and Fund-of-Funds.
Stefan K. Kräuchi has over 20 years of international experience in the in the asset management industry with UBS, AIG Investments (now PineBridge) and Credit Suisse Group in Zurich, Tokyo and Chicago. In his previous role he was a member of the Executive Board of a large Swiss private bank, where he was in charge of the products and services division with assets under management of over USD 20bn including insurance linked investments of over USD 2bn. Since 2004 he has been instrumental in pioneering and developing products in the ILS space for the Swiss and European market.
Hansrudolf Schmid is the founder and president of HSZ Group. After an education in law he pursued his career in finance, covering investment banking, private banking and investment management, first in New York followed by Zurich and Hong Kong.
Further Information on ILS Advisers can be found at
Founded in 2001, Eurekahedge is an independent financial data and research company focusing on alternative investments. Eurekahedge maintains coverage on 29,000 alternative funds globally and its research covers hedge funds, funds of funds, UCITS hedge funds, long-only absolute return funds, CTA/managed futures funds, emerging markets hedge funds, insurance-linked securities and specialist funds.
In addition to fund data Eurekahedge publishes the world’s largest suite of over 250 alternative investment benchmark indices, and the widely read The Eurekahedge Report, a monthly look at the alternative funds industry’s asset flows, fund performance, macroeconomic trends and league tables.
Eurekahedge has offices in Singapore and New York. Eurekahedge is owned by Mizuho Bank, which owns a 95% stake in the company.
For further information please contact:
Chief Executive Officer
+65 6212 0925
Eurekahedge Pte Ltd
1 Fusionopolis Link
Ms. Joey Tang
Phone: +852 2287 2300
Stefan K. Kräuchi
Phone: +852 2287 2303
Unit 605A, 6/F, Tower 2
Lippo Centre, 89 Queensway
Admiralty, Hong Kong