Berenberg, the private banking, investment banking, asset and wealth management specialist, will offer catastrophe bond trading over-the-counter (OTC) within its fixed income division, responding to what it sees as growing client demand for access to cat bond investments.
Trading catastrophe bonds in the secondary market is a critical feature for the liquid insurance-linked securities (ILS) sector, allowing investors to buy into cat bond deals after their issuance, trade them for positioning and portfolio management purposes, and offload their holdings for a variety of reasons.
While the cat bond market can be relatively liquid at times, especially at times of robust new issuance, it is also influenced by factors related to catastrophe events and so the secondary market can prove critical after loss events threaten, but also lack liquidity at those times as well.
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