Falling gov bond yields make ILS an even more valuable diversifier: Schroders

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The value of insurance-linked securities (ILS) as a diversification play within asset portfolios is now even higher, as falling government bond yields have made other diversifiers less attractive at a time when ILS is only increasing its value proposition to investors.

This is according to Stephan Ruoff, Head of specialist insurance-linked securities (ILS) and reinsurance investing firm Schroder Secquaero and Brad Angle, Alternatives Director at global asset manager Schroders, in a recent paper.

The response of Central Banks to the COVID-19 pandemic has driven a divergence in the fortunes of some alternative asset classes known typically as offering portfolio diversification.

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