September 2010/1

US broker-dealer Guggenheim Securities has launched a Bermuda transformer, as tipped by Trading Risk in March, with Horseshoe Group appointed as local manager.

The gap between peak and non-peak cat bond trading prices eased back in August after diverging into what Swiss Re described as a "bipolar" market mid-year.

Cat bond returns have quickly regained pace after losing ground in June and July, the Swiss Re Global Cat Bond Return Index shows.

The sale of substantial portions of three cat bond funds is thought to have contributed to the pricing slump in US wind-exposed bonds over the summer, Trading Risk can reveal.

Hot on the tail of a successful first cat bond "lite" securitisation, dedicated ILS fund manager Clariden Leu is working on a repeat transaction, using the European industry loss index PERILS as a trigger.

US insurer State Farm Mutual Automobile Insurance Company issued a third series of Merna notes in June, in an exclusive $250mn trade with a single investor, Trading Risk understands.

Former Horizon21 fund manager Urs Ramseier is launching two new funds, of EUR50mn and $50mn, while assuming control of his old firm's $110mn ILS investments at start-up Swiss fund manager Twelve Capital, Trading Risk can reveal.

Swiss Re's recent parametric insurance deal for the Alabama State Insurance Fund was a first $10mn baby step for what could be a billion dollar source of business for the convergence market.

The flexibility of capital is much vaunted as a positive side effect of convergence, and I tend to agree.

Up to four European wind bonds are tipped to come to the market in the second half of the year, helping to take total issuance volumes to the $5bn level predicted for 2010.

Leading ILS fund manager Credit Suisse Asset Management (CSAM) is approaching investors for capital in an attempt to raise up to $600mn for a new energy-focused retro vehicle, Trading Risk understands.