Lessons from a decade of FundCalibre
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Polar Capital Global Insurance
There are few managers with a more intimate knowledge of their market than Nick Martin, the manager of Polar Capital Global Insurance. His many years of experience working in the risk and casualty insurance markets are fundamental to the success of this fund, which provides access to this specialist and often undervalued sector.
Our opinion
Everything around us is insured, regardless of economic boom or bust, which provides this fund with very good defensive characteristics. Polar Capital Global Insurance is designed to provide exposure to non-life insurance companies, a specialist and often undervalued sector. The fund has been co-managed by Nick Martin since 2008 and he took on full responsibilities in 2016. The fund’s consistent track record offers a good return profile for portfolio diversification.Company description
Founded in 2001, Polar Capital supports more than 12 investment teams that focus on a range of products. Its founding strategy of fostering an equity culture amongst its employees and providing high levels of transparency to clients means 30% of the firm’s equity is currently held by directors, founders and employees. Polar Capital is principally located in London and maintains offices in Tokyo, Connecticut, Jersey, Edinburgh, Shanghai and Paris. It was awarded the Elite Equities Provider Rating in 2019 and 2021.
Fund manager
Nick Martin has been co-manager on the Polar Capital Global Insurance fund since 2001. He became lead manager in 2016. He has many years of industry experience and previously worked at Hiscox Investment Management, where this fund began its life. Nick participated in the management buyout of Hiscox in 2007 and joined Polar Capital in 2010. Nick is a qualified chartered accountant and has a degree in Econometrics and Mathematic Economics from the London School of Economics.
Management ownership of the companies in which we invest is crucial – as Warren Buffett says, no-one ever washes a rented car.
Nick MartinFund manager
Investment process
The team's extensive knowledge of the insurance industry means it can analyse companies in-depth. It looks to invest in quality insurers that can produce sustainable underwriting profits. It’s very easy to grow in insurance - you just charge less. But the team avoids these sorts of businesses preferring dull, boring and experienced management teams. They like management teams who are underwriting with their own money through material stock ownership. Polar Capital Global Insurance is focused and typically invest in 30-35 companies. It rarely invests much in life assurers, instead preferring specialist non-life companies, and those in the casualty and risk sectors.
ESG
ESG - Integrated
Nick has a very systematic approach to integrating ESG with this specialist fund. He has a proprietary scoring system for quantifying over 20 ESG factors. This also highlights any major red flags for the company, which will deduct from the overall score. These scores look at a variety of factors, such as environmental impact and climate change mitigation, through to diversity, staff development and approaches to data security. It encompasses governance factors through studying remuneration policies, executive alignment and board compositions. All identified issues are factored into each potential stock idea to create a qualitative and quantitative judgement on their ESG score, which is then assessed in conjunction with other factors.
Risk
This is a global equity fund but 60-80% of the portfolio is usually invested in US firms as the team believes they are typically better stewards of capital. The fund is predominantly invested in large companies but does have some mid and small-cap exposure. Although this is a specialist fund it is well diversified across the different types of insurance. It has historically been a bit less volatile than global equities.
Read more about this fund
The information, data, analyses, and opinions contained herein (1) include the proprietary information of FundCalibre, (2) may not be copied or redistributed without prior permission, (3) do not constitute investment advice offered by FundCalibre, (4) are provided solely for informational purposes and therefore are not an offer to buy or sell a fund, and (5) are not warranted to be correct, complete, or accurate. FundCalibre shall not be responsible for any trading decisions, damages, or other losses resulting from, or related to, this information, data, analyses, or opinions or their use. The Elite Fund rating is subjective in nature and reflects FundCalibre’s current expectations of future events/behaviour as they relate to a particular fund. Because such events/behaviour may turn out to be different than expected, FundCalibre does not guarantee that a fund will perform in line with its FundCalibre benchmark. Likewise, the Elite Fund rating should not be seen as any sort of guarantee or assessment of the creditworthiness of a fund nor of its underlying securities and should not be used as the sole basis for making any investment decision. FundCalibre disclaims any responsibility for trading decisions, damages or other losses resulting from any use of the Elite Fund rating. All performance data, as well as fund size, OCF, AMC, annual income (historic), share price discount or premium, is sourced directly from FE Analytics, and will change periodically.