Tony King, partner at Mariana Capital, takes a look at how changes in the financial markets over the past five years, have impacted the future of structured products.
A brief review of public offer structured product brochures from pre-Lehman days, provides an insight into how much this market has changed. Then, there was no disclosure of the identity of the counterparty (legal advice said it should not be done); the description of risks was superficial; and included in the product mix were products with high levels of risk built in. Today, those would not be seen in a public offer (triple index reverse convertibles with 60% American barriers, for example). While many practitioners might argue the regulator’s response to the crisis was somewhat hea...
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