Korea retail flows push China volatility to a record low

Volatility is trading at low levels on HSCEI despite China fears

south-korea-won

Korean retail investors buying autocallable structured products on the Hang Seng China Enterprises Index (HSCEI) are pushing China volatility down to record lows despite a China slowdown and increased risk on the horizon. Structured product issuance has long been a driver of Asia volatility with retail investors selling puts embedded within equity-linked autocallable structures to dealers to collect extra premium and juice up returns. However, an increase in Korean investors selling puts on t

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