The world's first catastrophe bond exchange-traded fund (ETF) launched just before the Trump administration's trade tariff battles but failed to secure the anticipated seed funding. Managed by Brookmont Capital Management LLC in Texas, the fund's Chief Investment Officer, Ethan Powell, explained that market volatility has caused potential investors to hesitate, delaying their entry into this new asset class. Powell noted the current environment is too unpredictable for aggressive moves.
The Brookmont Catastrophe Bond ETF (ILS, Financial) started trading on April 1 at the New York Stock Exchange, aiming to provide ordinary investors access to one of the bond market's most obscure sectors. Catastrophe bonds have consistently outperformed the market in recent years, with record issuance pushing the market size to $50 billion. After a 20% increase in 2023, catastrophe bonds delivered a 17% return last year.
