Facing volatile markets and the prospect of a recessionary downturn, insurance groups across Europe have been buying strategic equity hedges to cut their downside risk. Aviva, Axa, Allianz and Munich Re have all reported positive impact from equity hedging in their 2008 quarterly results.
For example, Munich Re reported EUR2.16 billion of equity-related writedowns in its second quarter (Q2) 2008 results, but this was offset by EUR1.1 billion of equity hedge gains, says head of group reporting,
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