Bank Of America
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| Dean Curnutt |
Bank of America's equity financial products division beat rivals to the punch with two of this year's biggest innovations in equity derivatives: options on variance and on volatility. The U.S. firm created the instruments to offer investors a volatility hedge in option form, allowing them to commit a defined dollar amount to express a view on volatility rather than relying on a swap format. BofA initially introduced the instruments on a bespoke basis to clients, but the firm also saw the advantage of getting other dealers on the Street into the market and did not hold back from spreading the word on the instruments' structure. This meant investors were soon able to get competitive pricing, proving crucial in kickstarting a market in the instruments which took flight in the second half of the year.
Equity market officials noted the sales force run by managing director Dean Curnutt is a major player when it comes to hedge fund coverage. The group is unusual, said one rival, because it combines both exchange-traded and over-the-counter sales and trading, which he suggested could partly explain BofA's edge in the U.S., where OTC equity derivatives tend to play second fiddle to the exchange-traded business.
Nominees:
* Citigroup * Lehman Brothers
* Goldman Sachs * Merrill Lynch
