Deutsche Börse has suggested that exchange-traded funds could be used for trading longevity once the market becomes sufficiently liquid.
Hendrik Rogge, responsible for longevity indices, said trading would be limited to such funds and future contracts, as regular trading would be impractical due to the monthly release of new data. He added that introducing ETFs was a "possible solution" towards making longevity risk more tradable, but that other stumbling blocks remained.
"It will be hard to find a day trader willing to trade within the days we publish these indices. Having ETFs – yes. I think it is a possible solution." Instead, Rogge argued that, once the market became more liquid, products on exchange could include futures contracts, as well as ETFs.
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