Cover story

Winning strategies

The new breed of systematic structured products offers investors a third way between long-only managers and hedge funds. As well as providing strategies similar to hedge funds, but with better transparency, liquidity and lower costs, the products could…

Highly cultured

Patricia Jalleh, head of group operational risk at United Overseas Bank Group, says that to achieve a robust op risk framework, a risk culture must be well and truly embedded within the firm. And no risk culture is perfect - it's a matter of constantly…

Unite or fail

The European Commission is busy preparing the detail of its proposals for a new framework of financial supervision - but will national supervisors see their powers and discretion curbed? Joel Clark reports

The bank capital burden

Keenly awaited Basel II trading book rules were due to be decided upon as Risk went to press. Market participants worry the measures could retard the development of risk models and even kill off whole business lines Mark Pengelly reports

Counterparty maze

Regulators in the US and Europe are evaluating the concept of a central trade repository for over-the-counter derivatives as a means of increasing transparency and allowing better detection of systemic weaknesses. But will they be able to overcome the…

KO-ed in Korea

Derivatives litigation has reached a new level in South Korea, where early court rulings on corporate currency options positions went against financial institutions and threatened the legal enforceability of derivatives contracts in the country. A change…

Out of the comfort zone

US banking supervisors will complete stress tests early this month to determine if the country's largest banks need to hold more capital to withstand a worsening in economic conditions. But industry practitioners raise concerns about the effectiveness of…

Ups and downs

Seen as a simple solution for reducing counterparty risk by regulators, moving credit derivatives on to central clearing platforms is proving fiendishly complicated. While progress is being made, it is generating more questions than answers. Mark…

Sovereign hedging lessons

The big oil-hedging losses at Sri Lankan state-owned refiner Ceylon Petroleum Corporation provide another salutary lesson in the proper use of derivatives. Is the situation reflective of state-owned energy companies as a group? By Joe Marsh

Where rocky horror assets go

With injections of government capital seemingly having little effect on restoring confidence in ailing banks, thoughts have once again turned to quarantining distressed assets. Rob Davies examines the options available to policy-makers

When hedge funds attack

The financial crisis has combined with catastrophic performances among hedge funds to decimate the fund derivatives industry, staunching new deal flow and causing many banks to pull out of the business. Mark Pengelly reports

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