Two former Lloyd’s of London analysts have launched an index which aims to provide an equity benchmark better suited to specialty re/insurance underwriting than other, non-specialist equity indices.

RISX Index focuses exclusively on the publicly-listed global insurance and reinsurance companies that control syndicates at Lloyd’s, and aims to provide investors with an equity proxy to compare against the reported pro-forma aggregate results of Lloyd’s.

The index uses a proprietary weighting algorithm based on reported premiums written, which aims to give a more appropriate mix of underlying risk than a traditional market capitalisation weighting, while ensuring sufficient liquidity in the underlying index components.

Quentin Moore, of Insurance Capital Markets Research, said: “We are extremely excited to launch the RISX Index, given the difficulty investors have traditionally encountered in benchmarking specialty insurance risk investment. We are delighted to be working with Moorgate Benchmarks as our regulated benchmark administrator and index partner. Their experience and regulated status allow all stakeholders to have full confidence in both the calculation quality and the governance of the index, as well as to develop investment products.”

Gareth Parker, chairman of Moorgate Benchmarks, added: “We are delighted to be the administrator of ICMR’s innovative index. ICMR’s insurance markets expertise and our index design input has resulted in a hugely interesting, important and tradable proxy for returns made from specialty re/insurance business.”

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