Derivatives
298 white papers and resources
Risk Library provides derivatives white papers which consider current issues and thinking, market conditions and how derivatives can be used to their best effect. In Business, a derivative is a form of contract where its value is derived from the value of underlying assets. Derivatives can be used to both hedge risk and for speculation. The most common types of derivatives are futures, options, forwards and swaps.
Credit products – alternatives for the private investor
After the cut in the prime lending rate to 1.25% by the European Central Bank, and with the inflation rate in Germany at 2.4% in November 2011, real returns are clearly negative. Consequently, investors are searching for products that are less affected by capital market fluctuations, but still…
Hybrids: Diversifying by unifying
Volatility is emerging as the norm for markets as analysts debate the interdependence of emerging markets and developed economies. Investors and risk managers who can gauge correlation between multiple asset classes correctly and unify them through hybrid products will find they are best prepared…
Potential impact of Solvency II on equity derivatives markets
Solvency II is a major regulatory theme for financial markets through 2011 and beyond. It will not only have an impact on insurance companies, but may also have wider repercussions across financial markets. This article provides a summary of the Royal Bank of Scotland’s latest report focusing on…
Currency Overlay
The much-elevated volatility level of the foreign exchange spot prices and a near-seizure of the foreign exchange forward and swap market at the height of the global financial crisis seem a distant memory for some, but many investors may be feeling distinctly uneasy about the currency risk in their…
The Inflation Vortex: Growth versus inflation – what path lies ahead?
A period of uncertainty has followed the global financial crisis, with forecasters differing in their predictions of how inflation will respond. The Royal Bank of Scotland’s Inflation Vortex is one tool that has been deployed to better understand the different inflation scenarios.
Tested model proves the clear choice in Europe and the US
Increased fear of counterparty default is pushing many institutions to seek reliable clearing solutions. Now, for the first time, the US buy-side can access LCH.Clearnet’s SwapClear via a futures commission merchant model. Floyd Converse, head of SwapClear US sales and marketing, explains the…
Regulating the renminbi
The last decade has seen a relaxation of rules regarding RMB services. DBS Bank’s senior vice president and head of complex hybrid products, Anthony Cheng, guides us through the regulatory history of RMB business across Asia and outlines investment opportunities.
Looking both ways
Regional markets are changing faster than ever, and investors outside the region are looking to repatriate funds amid growing inflation concerns and profit taking. Société Générale explains why it is dedicated to thought leadership through research and strategy, as investors find it difficult to…
Regulatory reform – The shape of things to come
The Bank of New York Mellon (BNY Mellon) is currently the only financial institution in the US with a triple A rating from Moody’s. With the firm’s representatives actively engaged in industry and public policy forums, as well as advising regulators, its derivatives and risk expertise is exemplary…
Shipping freight derivatives - theory and practice
As an inherently volatile industry, shipping is characterised by a high risk-high return profile, making its rates and prices difficult to forecast, and as a consequence business projects less accurately budgeted. The identification and management of any such business risks is imperative.