Secondary trading

ILS spreads began their seasonal tightening relatively late into the hurricane season this year, with widening persisting into May and June.

The average ILS expected return recovered to 3.66 percent by June 2015, from a low of 2.36 percent in September 2014, according to secondary market data compiled by Lane Financial.

The Swiss Re Global Cat Bond Price Return Index has experienced its largest first-half fall since H1 2011, when the market was rocked by Tohoku earthquake losses.

Typhoon bonds Akibare II and Aozora are on watch following predictions that Category 4 Typhoon Nangka could make landfall in southern Japan late next week, Trading Risk understands

Demand for high-yielding catastrophe bonds has remained strong on the secondary market, pushing up prices for such securities above par.

US state-specific wind bonds have been changing hands over the past month in reaction to a flurry of new issuance from Floridian insurers and state wind pools, according to US regulator Trace's Finra database

Insurance companies interested in issuing private placement catastrophe bonds offered under Section 4(a)(2) of the Securities Act may benefit from streamlining the structure of a bond, but they must be careful not to strip away important structural elements for capital markets risk transfer.

The first quarter of 2015 saw a slight hardening of rates on the ILS market, in contrast to the same period last year.

The secondary ILS market cleared a new record-sized trade of the $1.5bn Everglades 2014-1 cat bond in March, sources told Trading Risk.

Several cat bonds have been trading on the secondary market over the past week, led by AIG's Tradewynd Re (2014-1) class 1B notes, according to the Trace system of US regulator Finra.

The Alamo Re issuance from the Texas Windstorm Insurance Association (TWIA) has been one of the most actively traded bonds on the secondary market in recent weeks, making up over a third of trades recorded on US regulator Finra's Trace system since mid-February.

Catlin's new Galileo Re bond is already trading above par on the secondary market just weeks after its issuance.