The forex wildfire
Foreign exchange-linked products developed for private banking investors have evolved from simple dual currency deposits to complex over-the-counter trades. And banks are now introducing structures more commonly associated with institutional equity and fixed-income products to meet demand for high yield and income
As an asset class, foreign exchange is highly liquid, has a track record of producing positive excess returns and offers good diversification from equities and bonds. And as investors increasingly look towards investments other than equities and fixed income, banks that offer structured products linked to FX look set to be among the key beneficiaries of this trend.
"Investing or trading in the FX markets can potentially achieve high returns, which may attract inexperienced investors," says Craig
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