Highbridge-Linked Reinsurer Raises $1.1B

Apr 2 2014 | 10:06am ET

Another hedge fund has joined the reinsurance industry, and it’s the biggest to do so yet.

Highbridge Capital Management has partnered with Arch Capital Group to launch Watford Re in Bermuda. The new reinsurer debuted yesterday after raising more than $1.1 billion in initial capital.

Arch’s underwriting arm will serve as Watford’s reinsurance manager, while Highbridge’s Principal Strategies will manage the company’s premiums. The hedge fund, which is owned by JPMorgan Chase, will invest primarily in junk bonds, Watford said, “which it believes will generate attractive risk-adjusted returns for its shareholders over the long term.”

With Watford’s launch, Highbridge joins the likes of Greenlight Capital, Pine River Capital Management, SAC Capital Advisors and Third Point in setting up reinsurers, which provide a source of permanent capital to managers. SAC sold its SAC Re to Two Sigma Investments last year, following its guilty plea to insider-trading charges.


In Depth

Q&A: MackeyRMS's Chris Mackey On A High Tech Fix To Broker Votes

Jun 23 2017 | 8:17pm ET

The looming implementation of the EU’s MiFID II rules regarding research has put...

Lifestyle

CFA Institute To Add Computer Science To Exam Curriculum

May 24 2017 | 9:25pm ET

Starting in 2019, financial industry executives sitting for the coveted Chartered...

Guest Contributor

Steinbrugge: Asia-Focused Hedge Funds Offer Great Opportunities

Jun 23 2017 | 3:33pm ET

Emerging market strategies have outperformed their developed-market peers for five...

 

From the current issue of