With the conflict in the Middle East continuing to drive uncertainty and financial market volatility, Hong Kong based specialist insurance-linked securities (ILS) investment firm ILS Advisers has highlighted how catastrophe bonds can present a “compelling fixed income refuge” for allocators.
With the catastrophe bond market largely unaffected by major global shocks such as wars, given their focus in the main being on provision of risk capital to support reinsurance needs for natural peril events, they can prove a source of return through even the most volatile times.
ILS Advisers explained, “Escalating Middle East tensions have again driven equity declines, oil price surges, and elevated geopolitical risk. In such environments, investors seek assets insulated from macro shocks.
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