Cat bonds find their calling

Catastrophe bonds

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Investors have shrunk back from the securitisation market since August, anxious about possible exposures to subprime mortgages in structured finance portfolios. New issuance has ground to a halt in some classes of asset-backed securities (ABSs), while liquidity in the secondary market has all but dried up. A few sectors, however, have continued to show strong growth, as investors scramble around to find assets that are uncorrelated with traditional credit instruments. One of the main beneficiari