HSCM Bermuda has released its very own HSCM Public InsurTech Index (HPIX) in order to track the price movements of a portfolio of common equity securities listed in the last 10 years by companies operating in the US insurance sector.
The HPIX was created and is administered by HSCM, whilst Solactive AG calculates and publishes the Index online.
The index is weighted by total market capitalisation however, each company’s weight is limited to not more than 15% via a capping procedure. Last year when the index contained fewer components, several of them were capped.
The IPOs and SPAC mergers since the Index’s starting date resulted in several components being added, which resulted in the capping procedure becoming less material.
As of April 29th, the HPIX has reported an index value of 159, rising 59% since the index started with an initial value of 100 on the first trading day of 2020.
The index value rose by almost 75% last year, with a Sharpe Ratio of nearly 172%, reflecting a strong year for insurtech, with the index peaking in February this year.
A conventional definition of a “bear market” is a sustained 20% decline from the peak. A 20% decline from the peak is an Index value of 163, with the HPIX being mostly below 163 since March 4th.
The declines in late February and March of this year followed last year’s 75% increase in the Index value, however the past performance is neither a guarantee nor predictive of future results.
The Index is automatically updated during normal market trading hours by the calculation agent and can be accessed in several ways including on Bloomberg and online.