The road to high yield
The low-risk arbitrage opportunities found in the institutional structured products market this year may not be so common in 2010. Instead, more stable financial markets are expected to herald the return of product lines that can deliver extra yield
In the fast-moving markets of 2009 the key for structured products providers was presenting institutions with quick investment arbitrage ideas to take advantage of short-term market dislocations, and persuading the client to act fast before the market corrected itself.
Even so, many institutions still missed the second-quarter rally in equity and credit markets, and are now looking for some extra yield to boost their badly damaged portfolios.
“Among real money investors in late 2008 and early
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