The secondary market for catastrophe bonds alternated between extended periods of low trading volume and flurries of more active turnover in 2025. However, according to Swiss Re Capital Markets, the market remained relatively “bid-heavy” throughout the majority of the year, with limited offers and tightening spreads reflecting a sellers’ market characterised by excess capacity.
In its latest ILS Market Insights report, Swiss Re Capital Markets noted that the level of TRACE activity in 2025 showcased how secondary turnover remained subdued throughout large parts of the year before activity began to pick up episodically during periods where primary issuance and portfolio’s began to rebalance.
This aligns with the firm’s H1 2025 ILS Market Insights report, where Swiss Re Capital Markets noted at the time, that the level of TRACE activity had dropped when compared to H1 2024.
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