Microstructure, not correlation, shields pure-play cat bond ETFs from deleveraging regimes: King Ridge’s Pagnani
A new analysis from Rick Pagnani, CEO of King Ridge Capital Advisors, challenges the common assumption that catastrophe bond ETFs will mirror high-yield credit during market stress. The piece breaks down the structural features- no leverage, localized event risk, and market transparency - that have historically kept cat bond drawdowns shallow and bounded, and revisits the 2017 gating episodes to clarify what actually drove them.