Dual directional structured products, which are typically aimed at retail investors, are "exceedingly complex" and "tend to be priced at a significant premium to present value", according to a research report from Virginia-based Securities Litigation and Consulting Group (SLCG).
The report also finds that dual directional products with leverage on upside returns have a far lower average value than their unleveraged counterparts. "They are more poorly priced than the more transparent products,"
- Bank risk manager of the year: UBS
- People moves: Asia hires at Credit Suisse, new UBS data role, NatWest takes UBS's Duclos, and more
- Asia moves: BlackRock picks new Asia head, Credit Suisse boosts regional solutions, and more
- Risk solutions house of the year: HSBC
- We need a different approach to supervisory stress-testing