Mid-cap emerges

Equity derivatives

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European mid-cap equity derivatives haven't traditionally held much allure for investors. Over the past nine months, however, these instruments have begun to emerge from obscurity. The catalyst was the spike in equity volatility in May and June last year, which exposed the potentially dangerous basis risk of hedging large cash positions in European small- and mid-cap stocks with large-cap options. Keen to hedge their mid-cap exposures more precisely, investors have been piling into the marke

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