On March 22, 2021, the Plenum European Insurance Bond Fund was successfully launched with an initial volume of over EUR 20 million. The UCITS fund with a daily liquidity invests explicitly in subordinated bonds of European insurers.

The fund aims to benefit from the sector-specific extra premium and the market inefficiencies in the area of European subordinated bond segment.

The fund also invests in Restricted Tier 1 instruments (RT1) which are increasingly taking root in the European subordinated insurance bond market.

Daniel Grieger, partner and manager responsible for this line of business, says: «Subordinated bonds in the insurance segment boast an above-average premium in relation to the actual credit risk. They are perfectly suited to mitigate the challenges of the low interest rate environment.»

In-depth fundamental analysis, a focused approach and the regular exchange with the decision makers of the issuers are part of a strategy to capitalize on the dynamics of the insurance industry. Rötger Franz, lead portfolio manager of the fund, adds: «In our niche, taking a deep dive is essential when it comes to providing additional added value.»

«Due to the niche character of insurance bonds, research capacities have been drastically reduced, prompting us to specifically develop our expertise in this market segment», says Dr. Rainer Grünig, partner and CEO of Plenum Investments Ltd.

The fund is a further crucial step of the targeted expansion strategy of Plenum Investments Ltd. into the area of insurance bonds, which was started in 2020 with the successful launch of the Plenum Insurance Capital Fund.

«In times of increased inflation fears and high debt levels, investors are given the opportunity to optimize and adapt their existing portfolio to the challenges of today. While subordinated bonds of insurance companies are more volatile than traditional corporate bonds, their default rate is the lowest compared to other sectors», says Rötger Franz and adds: «In this niche sector, market dislocations are frequent. Our active management approach will help us to systematically exploit them.»

The fund is suited for investors aiming to strengthen the resilience of their portfolio and to increase the potential for higher returns on their investments in the current market conditions. It provides a solution to improve the risk return ratio in the segment of bonds with a current average BBB rating.

Currency-hedged share classes are available in CHF, EUR and USD. The duration risk is limited to five years. The fund is classified under Article 8 of the European Disclosure Regulation.

We would like to thank our investors for the trust placed in us and their commitment to support our new fund from the outset.

For further information, please contact us at the address below. We look forward to hearing from you.

Media contacts:

Switzerland: Plenum Investments Ltd. / Nico Rischmann
Email: nico.rischmann@plenum.ch / Phone: +41 43 488 5792 / www.plenum.ch

Germany and Austria: Plenum Investor Services UG / Robert Holzreiter
Email: robert.holzreiter@plenum.services / Phone: +49 8041 793 3803 / www.plenum.services