Insurers explore exchange-traded funds to boost yield
As insurers look for new opportunities to increase the yield on their investment portfolios, exchange-traded funds could provide an efficient way to diversify and gain exposure to areas such as emerging markets and commodities. ETF providers are expanding their range of products, but insurers are cautious. Louie Woodall reports
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Insurers need to venture further afield in the hunt for yield. With the developed world locked in a depressed interest rate environment, investment teams are increasingly turning to emerging markets to secure a decent income. However, tapping into the wealth generated in these regions in a safe and sustainable way is challenging. Emerging market debt is highly illiquid and equities unnervingly volatile.
Insurers are also looking to put their cash balances to
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