Speaking during a webinar held in August by the team behind the Brookmont Catastrophic Bond ETF (ILS), Rick Pagnani, co-founder of King Ridge Capital Advisors LLC, the firm that manages the cat bond ETF portfolio, said that while spreads have tightened in the space he believes they still adequately compensate for the risk.
Alongside Pagnani participating in the webinar, Ethan Powell, Principal & Chief Investment Officer of Brookmont Capital Management, LLC discussed the fact the catastrophe bond market has remained disciplined through the recent tightening phase we’ve seen.
Pagnani commented, “Certainly we’ve seen some tightening of spreads over the last 90 days, and the anticipation is there will be continued issuance, particularly given the tightening of spreads. So it makes sense that folks who have been issuing will look to expand. In addition, we’d expect new entrants in the market. We will see those toward the end of the third quarter, beginning of the fourth.
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