Company: GLRE
Filing Date: 2025-03-10
Form Type: 10-K
Source: 0001385613-25-000007
Chunk: 704

Company: GREENLIGHT CAPITAL RE, LTD.
Filing Date: 2025-03-10
Form: 10-K
Item: Item 1A
Chunk 704
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URES ABOUT MARKET RISK

Our financial instruments are subject to a variety of market risks.  The term market risk refers to the risk of loss arising from adverse changes from:

•equity price;•commodity price;•foreign currency; and•interest rate (including credit spreads).

We performed a sensitivity analysis below to estimate the effects that market risk exposure could have on the future earnings, fair values or cash flows of our financial instruments.  These represent forward-looking statements of market risk assuming certain adverse market conditions occur.  Actual results in the future may differ materially from these projected results due to actual developments in the global financial markets.

Equity Price Risk

At December 31, 2024, our investments consisted primarily of an investment in Solasglas. Among Solasglas’ holdings are equity securities, the carrying values of which are based primarily on quoted market prices. Generally, market prices of common equity securities are subject to fluctuation, which could cause the amount to be realized upon closing a position to differ significantly from its current reported value. This risk is partly mitigated by the presence of both long and short equity securities as part of our investment strategy. At December 31, 2024, a 10% decline in the price of each of the underlying listed equity securities and equity-based derivative instruments would result in a $14.0 million (2023: $12.3 million) unrealized loss in our investment in Solasglas.

Commodity Price Risk

Generally, market prices of commodities are subject to fluctuation. Solasglas’ investments periodically include long or short investments in commodities or derivatives directly impacted by fluctuations in the prices of commodities. At December 31, 2024, Solasglas’ investments incorporate unhedged exposure to changes in gold, uranium, and crude oil prices.

The following table summarizes the net impact that a 10% movement in commodity prices would have on the fair value of Solasglas’ investment portfolio. The below table excludes the indirect effect that changes in commodity prices might have on equity securities in the Solasglas’ investment portfolio. 

10% increase in commodity prices10% decrease in commodity pricesAt December 31, 2024  ($ in millions)Gold$7.9 $(5.9)Copper0.9 (0.7)Uranium0.4 (0.4)Total$9.2 $(7.0)

10% increase in commodity prices10% decrease in commodity pricesAt December