Losing lustre

Investors in Asia were hit with massive losses on so-called accumulator products earlier this year, causing concern among the region's regulators. How have dealers and investors responded to these losses? By John Ferry

Accumulators were seen as the perfect product when global equity markets were upbeat. So long as stock prices remained relatively stable, investors in these notes could buy shares at a discount to the market price, securing themselves a healthy profit. But when equity markets started to tumble earlier this year, those same investors - predominantly private banking clients - found out the hard way there is no such thing as a free lunch.

The terms of accumulator products mean investors are