Cat bond fund news

Today we are announcing our first wave of expert speakers that will be joining us at our next insurance-linked securities (ILS) conference, Artemis ILS NYC 2023 on February 10th in New York City. Please register soon to guarantee your place at the conference at the best possible price.

After hurricane Ian, it’s likely spread widening already seen in the catastrophe bond market only gets wider, which means, alongside rising risk-free returns, cat bond investment yields are set to stay at record levels, Florian Steiger of Twelve Capital has said.

The fourth session at our Artemis London 2022 conference on September 6th featured a keynote speech and a panel discussion, both focused on the potential for cyber risk catastrophe bonds and what the market needs to do for the first cyber cat bond to be issued.

Overall assets under management (AuM) of the main UCITS catastrophe bond funds as a group shrank almost -8% during the third-quarter of 2022, with hurricane Ian ending a period of decline with a -4.3% hit to assets of this group of cat bond funds.

Catastrophe bond funds, as measured by the Plenum CAT Bond UCITS Fund Indices, continued to decline in the last week, falling another average of nearly half a percent, bringing them to a -6.5% decline on average since hurricane Ian made landfall.

Secondary market trading of catastrophe bonds has accelerated as the market moves further beyond the initial impact of hurricane Ian, with activity rising, but the majority of trades still focused on diversifying peril cat bonds.

The catastrophe bond market index calculated by Swiss Re Capital Markets stabilised at its last calculation on Friday 14th October 2022, with a slight rise seen due to spread widening as secondary trades picked up pace following hurricane Ian.

Realised losses from hurricane Ian for the catastrophe bond market could end up being as little as half the initial, and still current, mark-to-market decline in the outstanding cat bond market, sources have told Artemis and our analysis also backs this up.

The third session at our Artemis London 2022 conference on September 6th featured a panel discussion titled “ESG in the cat bond market. Where next?”, in which participants discussed progress on environmental, social and governance issues in the catastrophe bond marketplace.

Catastrophe bond funds, as measured by the Plenum CAT Bond UCITS Fund Indices have fallen further in the wake of hurricane Ian at the last index calculation, with the average decline since the storm made landfall now -6.04% across the indices.