Taking the macro view

Market uncertainty means insurers are increasingly looking to protect themselves with macro hedges, but defining the risk they face is not always straightforward. Blake Evans-Pritchard reports

Since the financial crisis began in 2007, there has been a deepening trend within the life insurance industry to take a more holistic view of a company’s exposure to risk. With this better understanding of group risk exposure has come the acknowledgement that some risks are better managed across a broad portfolio of assets, rather than by looking at individual positions. Investment banks report that, as a result, trades executed at the macro level have been inching up the agenda.

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