FVC analysis: leveraged return vs dual directional products

Offering investors gains on the downside can present risk management headaches


Dual directional structured products, which offer investors exposure to both the upside and downside performance of an underlying asset, remain significantly less popular than traditional leveraged return products in the UK market, despite the "twin-win" opportunities they can offer. But what factors distinguish them in the minds of investors, and what risk management challenges do they present to issuers?

To analyse the impact of offering investors gains on the downside on a product's terms,

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