The most profitable hedge fund strategy of 2023 was investing in catastrophe bonds, and John Seo’s Fermat Capital Management owns the world’s biggest collection of them. Seo, who has a Ph.D. in biophysics from Harvard University, founded Fermat in 2001 with his brother Nelson. The two built a science-based model to weigh the probability of a natural disaster against the returns of a “cat” bond. When a disaster the fund bets on doesn’t occur, the returns are handsome.