A little protection

Recent volatility has helped boost the popularity of principal-protected investments in the US structured product market, which have traditionally lagged behind reverse convertible notes. But they face a tough challenge to gain anything like the traction that principal-protected notes hold in Europe

Gloomy prospects for US financial markets this year have failed to suppress a buoyant structured products space. Issuance for 2007 has now been confirmed to have topped the $100 billion mark, as predicted by the US Structured Products Association, which represents a rise of almost 80% on last year's $64 billion.

The market's current shape remains similar to its embryonic beginnings in 2003, when issuance was a mere $28 billion, in that reverse convertibles still constitute the majority of