Autocall concentration weighs on dealers

Hedging headaches force issuers to seek new structured product blockbusters

Like rich food and fine wine, in the world of structured products it is possible to have too much of a good thing. The cause of indigestion among dealers today is the autocallable bond. The high-yielding debt and equity hybrid was once a peripheral retail product, but now represents 80% of equity-related structured note issuance in Europe and Asia.

A torrid fourth quarter across global equity markets left Natixis with a €260 million hit on its Korean autocall book. Other major issuers of the

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