The Brookmont Catastrophic Bond ETF (ILS), the world’s first-ever catastrophe bond exchange-traded fund, hit the market on Tuesday, offering more investors access to complex securities that pass the risk of disasters from issuers to investors.
The new ETF from Brookmont Capital Management only holds catastrophe bonds, or “cat bonds,” that are tied to natural disasters—not other types of risks, like cybersecurity or terrorism. The expense ratio is relatively high at 1.58%, though the fund is the first of its kind to offer this high-yield asset class (typically only offered to institutional investors) in the accessible ETF wrapper.
ILS shares fell 0.10% to $20.08 in Wednesday afternoon trading.
ILS comes at a time of immense market uncertainty and volatility stemming from investors’ concerns around trade policy, interest-rate risk and the possibility of a recession.
“In a…
