However, IPD head of research Ian Cullen said the quarter saw "virtually zero" activity in derivatives based on a single sector, such as London office property. "Whatever people are doing, they are not using them to rebalance their portfolios," he said. Since 2005, when sector trades represented 50% of new trades, the sector market has declined to almost nothing, confounding analysts who argued that the ability to take positions on specific sectors of the property market would attract both speculative investors and natural hedgers.
The all-property index fell 7.6% in the quarter, its sharpest fall since launch, IPD announced earlier this week.
The week on Risk.net, December 2–8, 2016Receive this by email