Carlisle Management Company, a Luxembourg-based alternative global investment firm, has announced the successful deployment of its life settlement fund to above target returns.
Carlisle Management is focused on the life settlements of the Insurance Linked Securities Market (ILS) and its funds are supported by institutional clients including pension funds and family offices.
The company has focused on creating ILS life opportunities, working with partners to access the high-value life insurance policies it needs for its investment funds, which will have helped it build deployment of its most recent fund.
The investment manager said its Luzembourg-domiciled life insurance settlement investment fund Absolute Return Fund I FCP SIF was fully deployed within 12 months.
The deployment of the funds raised was in line with by Carlisle expectations, he said, with the fund now comprising several hundred life insurance policies, which are diversified by factors including, but not limited to face value, insurance company, age, mortality profile, scoring and sex.
Carlisle said the portfolio’s expected gross returns exceed the initial targets of investment managers, which he hopes will allow him to deliver solid returns to investors.
The company said the deployment is proof of âby Carlisle unprecedented position in the industry.
Thanks to its diverse network of life insurance policy origination partners, it helps secure its access to the tertiary market, noting that it has also accessed opportunities that are not always available to other market players.
The settlement-life fund has limited liquidity risks due to its closed structure, Carlisle said.
âWe expect that our absolute return funds will continue to operate with near zero correlation to financial markets and begin to provide liquidity to investors as originally intended,â said the investment manager.
Carlisle also made a draw on a new leverage facility, provided by a well-known private lender, to use as a premium facility to help reduce cash drag and boost fund performance.
âAs we continue to deploy capital for our absolute return funds, we are emphasizing a proactive strategy, strengthening existing market relationships and creating new ones,â explained Jose garcÃa, CEO of Carlisle Management Company. âAt the same time, we may have a unique opportunity to purchase Life Settlements at discounted prices due to the current economic environment, which would further improve returns for our investors. Carlisle believes that Life Settlements will have a limited impact from the current economic downturn, as it is a long-term investment strategy with limited correlation, and will outperform traditional financial markets in these uncertain times.
âInvestors in today’s uncertain economic environment see the benefits of lifetime settlements and realize that their fundamentals remain unchanged,â added Oleksandra Polishchuk, by Carlisle Marketing Director.
Carlisle believes his investors are willing to put up with some illiquidity, in return for what he sees as “the robust and uncorrelated qualities of life settlements” that make this niche of the ILS life asset class a “tool of unique diversification in times of market fluctuation “. “
This is particularly relevant at this time given the volatility in the global market seen in the wake of the Covid-19 coronavirus pandemic.