Standard Life Investments plans to extend its use of derivatives from large scale asset allocation shifts to more micro asset tweaking and eventually shorting corporate debt. Rod Paris, head of global fixed income in Edinburgh, said the life company has executed several billion pounds (notional) of derivatives to move assets from equity to fixed income investments over the past couple of years, but rule changes such as CP195 will mean it will have to make more frequent and subtle asset shifts for which it may use derivatives.
In addition, the asset manager's long-term goal is to be able to short corporates outright or short corporates it has invested in as part of its exposure to an index, but to which it does not want the credit exposure.
