P&C insurance ETF PCPC returned 12.5% in October

The Porter & Company Property & Casualty Index ETF (PCPC) returned 12.5% in October, more than double the 5.9% gain in the S&P 500 Financials sector, according to ETF Trends. The S&P 500 itself slipped nearly 1% over the month, while P&C insurance ETFs as a group posted double-digit returns.

Slide Insurance Holdings (SLDE) was the largest single contributor, returning 24.3% on a 10.5% average portfolio weight and adding 2.4% to the index's return, ETF Trends reported. HCI Group (HCI) came second: 13.8% on an 8.0% average weight, contributing 1.1%. Elsewhere in the book, RLI Corp rose 17.9%, Selective Insurance Group 18.2%, Palomar Holdings 13.8%, Allstate 17.1% and Kinsale Capital 13.3%.

PCPC selects and weights U.S.-listed P&C carriers by underwriting profitability rather than market capitalization, so a single holding such as SLDE carried an average 10.5% weight in October. For an advisor using the fund to hold financials, that means insurers chosen on underwriting discipline rather than the money-center banks and capital-markets businesses that dominate broad financial benchmarks.

ETF Trends attributed the month to firm premium rates and disciplined risk pricing supporting margins across commercial and personal property lines, plus improved investment yields on short-duration reserves. Broad financial benchmarks, by contrast, carry significant exposure to banks and capital-markets businesses sensitive to rate volatility, the report said.