Articles by Gautam Naik

Catastrophe Bond Issuance Is Set to Blast Through 2023 Record

Issuance of catastrophe bonds is on track to exceed the record set in 2023, as a cocktail of climate change, population density and inflation feeds growth in a market built around natural disasters. A fresh analysis by Swiss Re shows …

Catastrophe Bondholders Sidestep Large Losses From Weather-Related Calamities

Last month, amid reports that Hurricane Beryl would become the earliest Category 5 hurricane in history, a group of money managers were busy trying to figure out whether their highly calibrated bets centered on natural catastrophes were about to take …

Catastrophe Bonds Dodge Losses After Beryl Hits Jamaica

Investors in bonds intended to help Jamaica cover the costs of a natural catastrophe won’t be affected by the havoc wrought by Hurricane Beryl, even as the prime minister declares the entire Caribbean island a disaster area. As the earliest …

Catastrophe Bonds Are Luring Retail Investors to High-Risk Debt

There was a time when investing in catastrophe bonds was the preserve of hedge funds and other sophisticated alternative asset managers. But after underpinning the best hedge fund strategy of 2023, the bonds are finding a wider audience. Catastrophe-bond funds …

Catastrophe Bond Sales Soar as Markets Brace for Unusually Active Hurricane Season

Issuance of catastrophe bonds just hit a record high, as the market braces for a rough hurricane season with the potential to do substantial damage. Sales of so-called cat bonds are 38% higher this year through May than over the …

Catastrophe Bonds Use Models Underestimating Climate Risks, Investors Say

The risk models that helped drive one of the most lucrative bets of 2023 are increasingly being tested by smaller weather shocks fueled by climate change. Catastrophe bonds and other insurance-linked securities, which powered last year’s highest-returning hedge fund strategy, …

Zurich Insurance to Halt Coverage of New Fossil-Fuel Exposures

Zurich Insurance Group AG will no longer underwrite new oil and gas projects, and is cracking down on clients planning to expand in metallurgical coal mining. The restrictions also entail asking the highest-emitting corporate customers to reduce their carbon footprints, …

Hedge Fund That Rode Catastrophe Bond Rally Mounts Tactical Retreat

A hedge fund that last year delivered its best result ever thanks to catastrophe bonds is now scaling back its position, based on a bet that the market is headed for a rough patch. Tenax Capital, which has a €100 …

Risk Models Behind Insurance-Linked Securities Are Getting a Lot Harder to Crack

As the best hedge fund strategy of 2023 becomes a magnet for mainstream investors, the risk models it relies on are getting a lot tougher to crack. The strategy in question is tied to insurance-linked securities, which are dominated by …

Hedge Funds’ Mega Returns Set Off Demand Spiral for Catastrophe Bonds

As hedge funds rake in record profits in one of the riskiest corners of the debt market, the products behind those returns are now drawing in more mainstream investors. Catastrophe bonds, which last year formed the basis for the best-performing …