Playing the yield: rates rev up structured products

Higher government bond yields and steeper forward curves fuel demand for new range of fixed income structures

Equities are typically the driving force for structured products. But rising rates have given a turbo boost to fixed income structured products.

First came reverse convertibles, callables, then range accruals and autocallables – all linked to constant maturity interest rate swap rates. But now issuers are touting products linked to government bond yields.

The difference in underlying fix might seem