What kind of returns can I expect?
Är cat bonds really independent of equity?
How is my portfolio affected?
When should I enter the market?
What if interest rates increase?
Cat bonds from an investor perspective
Team specialized in insurance risks
Nordic home turf
Cat bonds – correlation to traditional asset classes
How do cat bonds work?
Entropics Asset Management – Cat bond investments
Cat Bonds are securities that transfer insurance risks from an insurer to the financial markets. This provides for insurance coverage for people and enterprises facing catastrophe risk. To investors, Cat Bonds offer an asset class with low correlation and historically good risk adjusted returns.
Fund investments entail risk. The value of investments in funds can increase as well as decrease and investors can loose all or some of the investment. Historical return is not a guarantee of future returns.
From our blog
One of the largest advantages of cat bonds is that they are fundamentally uncorrelated to other asset classes. A financial crisis does not trigger earthquakes. A deeper analysis also shows that large natural events do not affect broader markets, though they naturally have a large local impact. Read more
Improved standardisation regarding risk reporting can consolidate cat bonds as an asset class. Even waiting for a comprehensive standard, the industry could take several steps to increase the transparency of risk assessment. Read more
For fixed income instruments, such as cat bonds, the sensitivity to interest rate variation is very important to investors. Any investment in fixed-income instruments, such as traditional government or corporate bonds, or cat bonds, carries an interest rate risk. Cat bonds are, however, structured in a manner that minimises this risk. Read more