Citi Assigns Neutral Rating To Loeb’s Third Point Reinsurance

Citigroup Inc (NYSE:C) assigned a Neutral rating to Third Point Reinsurance Ltd (NYSE:TPRE), as the reinsurance major focuses more on investment performance rather than underwriting.

Erik J. Bass and the team at Citi Research feel the property and casualty reinsurance company inverts the typical reinsurance model by taking on limited insurance risk and investing 100 percent of its assets portfolio in Third Point LLC’s hedge fund strategy.

Third Point to trade at lower P/E

Citi analysts report that such an inverted model could generate above-average returns over...