Risk managing structured products in a falling market

Capital-at-risk products with European-style barriers inherently more vulnerable in a downturn

Tim Mortimer is managing director of Future Value Consultants

When other investments outperform structured products, it is tempting for investors – or regulators – to apply a curious hindsight when deciding how the products should be judged.

Recent months have seen equity markets behave in a volatile fashion, with some significant losses posted during this period and several product types – notably autocalls with exposure to the Hang Seng China Enterprises Index (HSCEI) – becoming vulnerable as