Rochdale ILW & cat bond fund returns 11.77% with only modest catastrophe impacts

This content is copyright to www.artemis.bm and should not appear anywhere else, or an infringement has occurred.

The City National Rochdale Select Strategies Fund, a mutual insurance-linked securities (ILS) strategy focused on industry loss warranties (ILWs) and catastrophe bonds, delivered a net return of 11.77% for the year ended January 31, 2025.

While down from the 15.58% return recorded the previous year, 2024’s performance still marked a second consecutive year of strong, above-average gains for the interval-style fund.

Run by City National Rochdale, the fund combines structural customisation with tactical risk management across ILWs and cat bonds. As of the end of January 2025, total net assets reached $228.2 million, up from mid-2024 levels, reflecting continued investor interest in ILS as a source of uncorrelated returns amid broader market volatility.

“This year’s performance was the second year in a row with higher-than-average positive returns and the Fund’s sixth consecutive year generating positive, fundamentally non-correlated returns,” said Gregg Giaquinto, President of City National Rochdale.

According to Giaquinto, the fund’s defensive positioning ahead of a hyperactive 2024 hurricane season played a key role. Portfolio construction focused on more risk-remote attachment points and custom structures designed to reduce the risk of impairment from a single event. Exposure to risk was further hedged through the purchase of additional ILW protection.

“These improvements can be evidenced by the increase in loss-exposure breakeven points compared to past years,” Giaquinto explained. “The dynamic risk positioning exemplifies the ability to moderate through prudent underwriting and highlights the customizability of the ILW product.”

While catastrophe bond allocations were more modest in the portfolio, the fund still benefited from a record second year of primary market issuance in the cat bond space. However, the lighter weighting meant the fund slightly underperformed the Swiss Re Cat Bond Index, which returned +14.41% over the same period.

Even so, the Select Strategies Fund outpaced traditional cash proxies like the ICE BofAML 3-month U.S. Treasury Bill Index, which returned +5.19% for the year ended January 31st 2025.

It’s worth noting that this performance comes amid a strong overall year for the ILS market, which has seen continued investor demand, particularly for cat bonds and ILWs offering attractive risk-adjusted yields and structural clarity.

“The Fund’s portfolio construction process for 2025 is now well underway, and we are focused on diversification and capital-efficient opportunities in the ILW and Cat Bond markets, where we believe risk-adjusted returns are most attractive,” Giaquinto added.

“We are excited for the opportunity to further capitalize and source attractive opportunities for our shareholders in the coming months.”

Rochdale ILW & cat bond fund returns 11.77% with only modest catastrophe impacts was published by: www.Artemis.bm
Our catastrophe bond deal directory
Sign up for our free weekly email newsletter here.