BNPP makes first big options trade on Nikkei 400 index

Hedging remains an issue until futures are launched in November

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French bank BNP Paribas says it is the first bank to execute a several hundred million dollar options trade on the three-month-old JPX-Nikkei 400 index but the absence of a futures market means it has had to proxy hedge any market movements.

The JPX Nikkei 400 index, launched in January, has given investors in Japan an alternative to the existing Topix and Nikkei 225 indexes which have been criticised for giving skewed weighting to certain names.

The new index uses a free-float methodology weigh

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