(Bloomberg) -- There was a time when investing in catastrophe bonds was the preserve of hedge funds and other sophisticated alternative asset managers. But...
-- There was a time when investing in catastrophe bonds was the preserve of hedge funds and other sophisticated alternative asset managers . But after underpinning the best hedge fund strategy of 2023, the bonds are finding a wider audience.Catastrophe-bond funds marketed under Europe’s UCITS label, which is designed to protect retail investors, have seen their assets under management rise 12% this year to a record $12 billion, according to Kepler Partners, a research and advisory firm.
“We believe the combination of continued elevated pricing, combined with the ongoing demand for reinsurance, may present an attractive investment opportunity throughout the remainder of 2024 and into 2025,” Amundi said in a May report on cat bonds. “We’re not actively marketing to the retail space,” he said, but banks hold cat bond funds in their discretionary accounts, “so retail investors will ultimately end up being exposed.” Plenum manages two UCITS cat-bond funds.
Though a broader group of investors now holds cat bonds, insiders say it’s their impression that the market continues to be dominated by veterans with a deep understanding of how the securities work.
UCITS Retail Investors Asset Managers Catastrophe Bonds Cat Bonds Hedge Funds Cat-Bond Hedge Fund Strategy
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