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Swiss Re cat bond index Q1 return hits 4.57%, runs barely behind prior 12 months


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The overall-return of the excellent disaster bond marketplace for the first-quarter of 2024 has reached 4.57%, in keeping with information from the Swiss Re Cat Bond Efficiency Indices, which reveals that cat bond market efficiency is working barely behind the prior 12 months.

The very fact the efficiency of the cat bond market is working behind that seen in 2023 is not any shock.

Whereas we’re seeing value results once more in 2024, as provide and demand components drove secondary market costs greater, this has not been as vital as the value results skilled in early 2023, which have been largely pushed by recoveries in worth following hurricane Ian.

As we’ve reported plenty of instances, an affordable proportion of the file disaster bond market efficiency from 2023 got here by way of recoveries in worth to cat bond positions that have been closely marked down after 2022’s hurricane Ian.

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That may’t be repeated, after all, however value results have been a part of returns earned by cat bond traders up to now in 2024 as nicely, simply not at such a big fee.

By the tip of the first-quarter of 2024, the Swiss Re cat bond complete return index was working up by 4.57%, which we consider to be the second-best begin to the 12 months on-record for cat bond market returns, after 2023.

Swiss Re catastrophe bond index returns by year - end of Q1 2024

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It’s one other very robust begin to the 12 months for disaster bond market returns, which traders have been benefiting from, as different indices exhibit.

As we reported, disaster bond funds structured within the UCITS format delivered their traders a median return of three.65% for the first-quarter of 2024, in keeping with the Plenum CAT Bond UCITS Fund Indices.

The upper-risk group of UCITS cat bond funds achieved 3.76% for a similar interval and the typical reached above 4% by April twelfth, the most recent information reveals.

In the mean time it appears unlikely the Swiss Re cat bond index complete return can equal the very robust efficiency from H1 2023, when it reached a ten.34% total-return by the tip of June.

Recall that, as we reported just lately, the disaster bond market yield fell to simply beneath 12% on the finish of March 2024, so the first-quarter return of the Swiss Re cat bond index seems comparatively aligned to that with some value results on high.

Disaster bond market returns proceed to trace at excessive ranges, regardless of the softening of disaster bond issuance spreads, which you’ll see proof of right here in our charts displaying cat bond pricing and spreads, in addition to cat bond multiples-at-market, by years and quarters.

Discover all of Artemis’ disaster bond market charts and information right here, or by way of the Artemis Dashboard.

All of our charts are up to date as new disaster bond points full, and as older issuances mature, based mostly on the information in Artemis’ in depth disaster bond Deal Listing.

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