Buyside Reduces Div Exposure On Tax, Scrip Fears

Asset managers and hedge funds have been reducing their exposure to the Eurostoxx 50 index dividend futures expiring in 2012 and 2013 by selling variations of calls or rolling options to 2014 and 2015 futures. The move is being driven by growing fears over how dividends are to be taxed in the eurozone. Another issue is the potential impact of further scrip dividends issued by European institutions and what the breakup of those dividends will be over the next two years.