Centurion launches structured note linked to longevity
Centurion Fund Managers, the asset manager domiciled in the Cayman Islands and specialising in longevity alternative investments, has launched a structured note linked to the performance of a Global Population Index (GPI).
The GPI Structured Note, a secured fixed interest index-linked product with an investment term of five years, relies on an index measure of actual to expected mortality of over-65s in a pool of selected European countries, North America and Australasia. The underlying index data is sourced from governments.
If the mortality measured by the GPI increases, then the potential return to investors increases. If mortality is lower than expected the structured not still offers protection of the initial investment. This means the range of returns could vary between 3.9%-6.9%.
The GPI Structured Note is the first offering under Centurion’s Principle Protection Longevity Index Note series. The provider says it comes in response to European demand for access to securitised assets.
Centurion cites research suggesting more than four in ten European investors want long-term investments with low market correlation. In the area of longevity products in particular, the data suggests “47% of European investors use structured notes and a further 25% use structured Ucits.”
“54% are interested in longevity but only 6% currently use the asset class in portfolios. The top reason for not using longevity investments is ‘lack of time to research the asset class properly’.”
David Rawson-Mackenzie, managing director, Centurion Fund Managers, said: “We think the GPI Structured Note offers an achievable steady annual return of 5% that would benefit most investment portfolios by diversifying away from high exposures to equities, bonds and commodities as highlighted by our market research.”
“The GPI Structured Note is already launched in Asia and we have a lot of interest from financial advisers, wealth managers, family offices and private banks in the region. The product is ideally suited to investors looking for defined returns, genuine portfolio diversification and low correlation to traditional markets”