Analysis: enhancing risk management of single stock underlyings

Decrement indices have become increasingly popular in the last ten years. They take an existing index, stock or other underlying and create a synthetic version by exchanging an actual dividend stream for a fixed one. They are principally created for use in structured products. Decrement indices have emerged as an alternative solution in many markets and are particularly popular in France - Tim Mortimer, FVC Most structured products are “long” the underlying, meaning that if the u