Any serious structured products house will be exposed to skew. These days, most banks are content to hedge this risk using vanilla strategies. However, a small faction of equity derivatives players believe there is a better way to cope with skew exposure. They argue that products purpose-built to pass skew to investors will give banks a more accurate hedge. Others contend these new products do not serve to repackage any risk per se, but are simply another financial instrument.
"There are comp
The week on Risk.net, December 2–8, 2017Receive this by email