Trade war threatens Korea autocall losses
Dealers warn of $240 million in hedging losses if HSCEI index slides further
The South Korean financial regulator has sounded a warning about structured products linked to the Hang Seng China Enterprises Index, which has lost nearly a quarter of its value since January amid US-China trade tensions.
The Financial Supervisory Service plans to monitor the sale of the popular autocallable products as the HSCEI edges closer to territory that dealers say could generate hedging losses of as much as $240 million.
“As there are concerns that excessive volatility in the global
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