Question

Catastrophe bonds are attractive to investors due to which of the following(s): multiple c...

Catastrophe bonds are attractive to investors due to which of the following(s):

multiple choice:

The returns on these bonds are relatively high compared to other bonds

The principle invested into these bonds is relatively secure compared to other bonds

The returns on these bonds are uncorrelated with the market

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Answer #1

Cat bonds allow diversification because

The returns on these bonds are uncorrelated with the market

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