| Author: David Shirreff Since derivatives aren't an asset class it surely makes sense to sell them along with the underlying cash instrument rather than market them independently.
There is an inherent conflict. The more you integrate product areas, the less vigorously individual products are marketed. Selling integrated solutions to customers' risk-management problems sounds good, but turnover suffers. One derivatives expert recalls the sad history of Paribas, which went for total integration in around 1993. "I think it was a mistake: it killed derivatives at Paribas," he says - although there was a later attempt to recreate an independent derivatives operation. |
