Uncommon Hedging Strategies Used By Issuers

Structured notes and inverse floaters aren’t just complex—they’re strategic tools for investors who want to control risk and forecast interest rate moves. Learn how to calculate them and why they matter when the market shifts.

This video looks into structured notes, which are debt instruments customized with special features to entice investors, often in tandem with derivative positions.

One prime example is the inverse floater, where the yield moves inversely to interest rate fluctuations. Despite offering unique payoff patterns, issuers typically hedge their own risks using derivative positions.

Structured notes allow investors to capitalize on interest rate forecasts, balance current and future yields, express market views, and adjust risk levels according to preference.

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Видео Uncommon Hedging Strategies Used By Issuers канала Frugal Finance