Financial institutions do not disclose the methodologies they use in their proprietary indexes. This prolongs the suspicion that structured products based on these indexes ultimately hide or at least obscure a conflict of interest. Although banks are under pressure on several fronts to make their business more transparent, they are still reluctant to confront this latest raft of criticism.
"A theoretical possibility is that an index can be manipulated to suit the trading position of the bank, an
The week on Risk.net, May 12-18, 2018Receive this by email