Market snapshot

Tim Mortimer of Future Value Consultants looks at pricing issues of structured products in different markets and provides his trade of the month

Turbulent market conditions continued into November 2007. Although the fixed-income markets had the confidence to post falls in interest rates (by as much as 40 basis points in the five-year rate), equity volatility nudged higher. The combined effect of this was to knock between 7% and 10% off participation rates for the guaranteed structures shown below. The SPX 500 and DJ Eurostoxx 50 in particular now show extremely low participation levels - to the extent which such products have long since