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Jerry Szilagyi, AlphaCentric

Rational Funds launches Context Insurance Linked Income Fund


Rational Funds, a family of funds rooted in the investment philosophy of applying a rational approach to investing, has launched the Context Insurance Linked Income Fund (ILSIX).

The fund will be sub-advised by Context Insurance Strategies and is designed to bring a traditionally institutional-focused investment approach to all investors.
ILSIX invests primarily in income-producing, insurance-related investments and yield-oriented insurance securities to achieve the objective of total return. The fund will focus its investments on Cat Bonds and insurance-related investments such as event-linked bonds, event-linked swaps, corporate debt and preferred stock issued by insurance or reinsurance companies. Cat Bond returns are tied to a single or multiple insurance event(s) and are designed to replicate the function of a reinsurance agreement.
“The Context Insurance Linked Income Fund brings the benefits of insurance-linked securities (ILS) to the mutual fund market with a strategy offering unlike any currently available to all investors,” says Jerry Szilagyi (pictured), CEO of Rational Funds. “The launch of ILSIX is part of our continued commitment at Rational Funds to sponsor rationally-driven, disciplined and systematic investment approaches.”
Under normal circumstances, ILSIX will invest 80 per cent of its assets in insurance-related investments. The investment strategy is designed to invest in a varied group of available risks and geographic regions.
Pete Vloedman and Andrew Sterge, who have a combined 45-plus years of reinsurance and ILS experience are the portfolio managers for the fund.
“Compared to other non-traditional fixed income products, our strategy will aim to provide returns that are minimally correlated to interest rates and bond and equity markets, while providing investors access to an asset class currently dominated by large institutions and hedge funds,” says Sterge.
The fund will trade under the tickers ILSIX, ILSAX and ILSCX.

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