Raising the stakes

Dealers are offering a raft of highly leveraged equity-linked structured products to Asian investors. But capital-guaranteed structures and a growing range of hybrids are also proving attractive ahead of a potential downturn in the region's hot equity markets. Kathleen Kearney reports

Equity-linked structured products are very popular in Asia and have become a multi-billion-dollar business for investment banks in Hong Kong, Singapore and Tokyo. Structures considered exotic 18 months ago are now reproduced by the hundreds every day. To boost margins and grab a greater share of the market this year, financial engineers have brought out a steady stream of exotic, high-risk products, as well as a new generation of principal-protected structures, which are aimed at riding out the