Swiss Re Insurance-Linked Fund Management

Original Risk: A Society for Change Agents

Cat bond and ILS secondary market trading patterns in 2011


The secondary market for trading in catastrophe bond and insurance-linked securities saw brisk activity throughout much of 2011. Of particular interest is the trading patterns and how the secondary market reacted to events which impacted these markets. We’ve written before about how catastrophe events and potential hurricanes have impacted secondary market confidence and thus trading volumes. Here we feature some more data from Swiss Re which shows the pattern across 2011 and also cumulative trading volumes versus prior years.

Overall, secondary market trading in 2011 saw a slightly lower volume of trades than in 2010, but higher than 2009, according to data from Swiss Re’s own ILS and cat bond trading activities. This isn’t data from the whole of the secondary market, but the patterns it shows are representative of the patterns that will have been experienced on other trading desks and across the market as a whole.

The graph below is taken from Swiss Re’s recent ILS market update, which we covered in more detail here. It clearly shows the huge spike in trading at the time of the Tohoku earthquake and further spikes during the peak period of the U.S. tornado season when the Mariah Re cat bonds were impacted and the approach of hurricane Irene which caused further trading volume spikes.

Over the whole of 2011 Swiss Re’s secondary cat bond and ILS trading desk saw over $875m in trades. Trading volumes declined in the last two months of the year due to the significant amount of primary cat bond and ILS issuance which saw traders look to put money into new deals rather than outstanding cat bonds. Had primary issuance not been so brisk, the cumulative figure for 2011 would have been much closer to the 2010 total.

Register today for ILS NYC 2023, our next insurance-linked securities (ILS) market conference. Held in New York City, February 10th, 2023.

Artemis ILS NYC 2023 - Insurance-linked securities conference in New York City

Get a ticket soon to ensure you can attend. Secure your place at the event here!

2011 Monthly and Historical Cumulative Secondary Catastrophe Bond and ILS Trading Volume

2011 Monthly and Historical Cumulative Secondary Catastrophe Bond and ILS Trading Volume

Print Friendly, PDF & Email

Artemis Newsletters and Email Alerts

Receive a regular weekly email newsletter update containing all the top news stories, deals and event information

  • This field is for validation purposes and should be left unchanged.

Receive alert notifications by email for every article from Artemis as it gets published.