The Ambassador US mutual catastrophe bond fund strategy operated by advisor Embassy Asset Management has now expanded its insurance-linked securities (ILS) fund’s assets under management to $428 million, with expansion across the portfolio and more industry-loss warranty (ILW) investments made as well.
The Ambassador cat bond fund was launched in the third-quarter of 2021 by investment advisor Embassy, which has a focus on non-correlated strategies that deliver income to its clients.
With a dedicated catastrophe bond and insurance-linked securities (ILS) investment focus, Embassy was the newest entrant to the US mutual ILS fund marketplace at the time.
The strategy began allocating capital to catastrophe bonds in the quarter to April 30th of 2023, while also entering into its first private ILW arrangement under the Consulate Re structure.
After that, the Ambassador Fund benefited from growing investor interest and took more inflows into its catastrophe bond focused strategy through 2023 and 2024.
We last reported on this largely cat bond focused fund when it surpassed $329 million in assets under management (AUM) in October 2024.
Now, as of its last formal reporting of data for January 31st 2025, the Ambassador Fund’s total assets under management had reached almost $418 million.
Which is a more than doubling in size in one year, as the Ambassador cat bond fund had only $164 million in total net assets at January 31st 2024., representing impressive 155% growth in just twelve months.
We understand though, that the fund has continued to grow in recent weeks as well, reaching $428 million in net assets as of the end of February 2025.
The one-year rolling return appears to be running at around 11.67% as of the end of February, however like many cat bond funds the year-to-date appears more muted due to some price effects likely caused by the California wildfire impacts to certain positions, which has reduced the 12-month return.
In the last full-year of performance, to October 31st 2024, the Ambassador cat bond fund achieved a 13.5% return.
As of January 31st 2025, the Ambassador Fund counted $330.3 million of catastrophe bonds within its portfolio, while the preferred note investments into industry-loss warranty (ILW) contracts under Consulate Re amounted to just over $59 million, with the rest of the net assets comprised of short-term investments.
The Consulate Re private investments into ILW’s are a way for the Ambassador portfolio management team to source additional investments, then transform them to a structure suited to a mutual ILS fund strategy.
As we understand it, they are all transformed and securitized industry-loss warranties (ILW) arrangements and now, as of the January 31st reporting, the Ambassador Fund portfolio has 10 Consulate Re positions, 7 of which are 2025 series and so more recently invested in, it appears.
