Structured products
WHAT IS THIS? Structured products are investments that have multiple components. For retail investors, the most common form is a bond plus an option – these tend to be standardised, sold in small tickets and large volumes. Managing the risks of large structured products portfolios is one of the biggest challenges dealers face.
Hedging in a spin
Editor's letter
Weathering the storm
Lehman Brothers' collapse has potentially ruinous consequences for the US structured products market. But delegates and speakers at the Structured Products West Coast Conference were surprisingly upbeat about the future and opportunities that have arisen…
Building in safety
The structured products market in Asia is almost unrecognisable from where it was 12 months ago. Products such as accumulators and range accrual notes have been consigned to history, while product manufacturers and distributors alike look for new ways…
Changing landscape
The Irish structured product landscape is changing as volatile financial markets push investors to seek alternative assets, capital protection and shorter-term products. In a week of financial turmoil and failing banks, issuers' credit ratings were a…
Higher and higher
Volatility
Market snapshot
Tim Mortimer of Future Value Consultants looks at the pricing issues for structured products in different markets and provides his trade of the month
Lehman Brothers losses loom large
The collapse of Lehman Brothers has shocked investors in structured products. Previously immune to the financial crisis in the immediate markets that surround them, those that bought products from the defunct US investment bank are now contemplating…
Seeking a bite from the goliaths
Sovereign wealth funds
Fund farewells to leverage
After the heydays of 2005 and 2006, the structured funds space is showing signs of strain. Liquidity shortages and worries about the future of some hedge funds have taken their toll, leading some banks to withdraw or make big cuts in investment in this…
Sunk by correlation
Equity Derivatives
Barclays delivers fourth issue of Emerging Markets Optimiser
Barclays Wealth has released the fourth issue of its five-year Emerging Markets Optimiser, which has accrued more than £50 million since the first tranche launched in February. The plan offers the Eastern European option that was introduced in the June…
Lehman releases inaugural issue of Dual Income Plan
Lehman Brothers has launched the first issue of its Dual Income Plan, offering investors a choice of 8.8% annual fixed income or 0.71% monthly fixed income. The five-year plan, linked to the FTSE 100 index, provides full return of capital at maturity…
A structure out of all proportion?
Volatile markets have reignited the debate about the validity of constant proportion portfolio insurance, leaving investors cashed-out and locked in. Structurers are coming up with new ways to tackle the structure's weaknesses, but could bond and option…
Hearing aids
The European Union opened its investigation on retail investment products to the public on July 15, at an open hearing held in the EU buildings in Brussels. The hearing attracted more lobbies than had been expected, 80 of which had submitted their views…
Stuck on structures
Editor's letter