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
Debate: "Capital markets must be leveraged for climate efforts"
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||Rate||Since start||One week||One year||Report|
|SEF Entropics Cat Bond (Class A)||103.54||+3.54%||+0.09%||+2.36%||Latest report|
|SEF Entropics Cat Bond Fund Class I (institutional investors)||100.81||+0.81%||+0.10%||—||Latest report|
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
“In order to cope with the climate change threat, we must not only decrease emissions of greenhouse gases. We must also be able to manage severe consequences of climate change. Hence, we should, to a considerably greater extent, leverage the resources provided by capital markets,” argues Entropics’ chief meteorologist Martin Hedberg and former minister for financial markets Peter Norman in a debate article. Read more
How can we provide for improved insurance protection in developing economies? Parametric cat bonds and index based insurance offer possibilities. Sometimes critics argue that this entails a lack of correlation between damages and payments. But is this necessarily a disadvantage? Read more
A traditional investment portfolio complemented with cat bonds would be expected to deliver more stable returns. Looking at the past ten years, a traditional portfolio, allocated to Swedish and foreign equity and bonds, would have delivered higher returns and a lower volatility with a cat bond allocation. Read more
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