Vega peak was foothill in historic Nikkei selloff
JFSA scrutiny has curbed issuance of autocallables, so stock plunge generated light re-hedging
The baleful eye of Japanese regulators may have made yesterday’s historic collapse in the Nikkei index a little less chaotic – at least for structured products issuers.
Autocallable products known locally as ‘uridashi’ have been in the crosshairs of Japan’s Financial Services Agency since June 2022, when a review into sales practices was launched. Since then, issuance has been light, making it easier for dealers to hedge as stocks sold off.
“I’m sure the regulators are looking at it now and
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