In focus

What has driven catastrophe bond spreads to record highs?

With spreads on cat bonds at or near record highs and volatility in public markets pronounced, some investors are understandably weighing up if now is a good time to allocate to ILS as an uncorrelated asset class.

We believe that many investors could indeed benefit from incorporating ILS. However, it is worth a closer look at underlying dynamics within the (re)insurance industry, as well as the ILS market, to know what to expect.

Here we explain why spreads have widened as they have, explore the conclusions investors can draw when assessing the opportunity, and outline what they can expect to see in coming months.

Read the full report

What has driven catastrophe bond spreads to record highs?


Important Information
The contents of this document may not be reproduced or distributed in any manner without prior permission.
This document is intended to be for information purposes only and it is not intended as promotional material in any respect nor is it to be construed as any solicitation and offering to buy or sell any investment products. The views and opinions contained herein are those of the author(s), and do not necessarily represent views expressed or reflected in other Schroders communications, strategies or funds. The material is not intended to provide, and should not be relied on for investment advice or recommendation. Any security(ies) mentioned above is for illustrative purpose only, not a recommendation to invest or divest. Opinions stated are valid as of the date of this document and are subject to change without notice. Information herein and information from third party are believed to be reliable, but Schroder Investment Management (Hong Kong) Limited does not warrant its completeness or accuracy.
Investment involves risks. Past performance and any forecasts are not necessarily a guide to future or likely performance. You should remember that the value of investments can go down as well as up and is not guaranteed. You may not get back the full amount invested. Derivatives carry a high degree of risk. Exchange rate changes may cause the value of the overseas investments to rise or fall. If investment returns are not denominated in HKD/USD, US/HK dollar-based investors are exposed to exchange rate fluctuations. Please refer to the relevant offering document including the risk factors for further details.
This material has not been reviewed by the SFC. Issued by Schroder Investment Management (Hong Kong) Limited.