Rabobank will start trading equity derivatives in Hong Kong by year-end and is sending Aurelien Bessot, equity derivatives trader in London, to head the new operation. The Dutch house has expanded institutional and private banking business over the last two years and these clients are interested in Asian underlyings, explained Bessot.
The desk will trade options on Asian indices and also plans to offer warrants on Asian stocks. "We will have better prices on Asian indices by being there," said Bessot. He noted Rabo Securities in London already trades options on the Nikkei index to hedge structured equity products, but having a desk in Asia will mean Rabo can offer a greater range of Asian underlyings for structured products. Bessot said the bank intends to build up its retail business in Asia by marketing equity warrants and it may also look to structure investment products for clients in Asia.
Bessot, who moves at the end of this month, will hire a second trader once he is in Hong Kong. Rabobank already has a fixed income desk in Hong Kong, but its last equity derivatives effort there was closed four years ago. Barclays Capital and Royal Bank of Canada are among other houses to move trading desks to Hong Kong in the last few months (DW, 10/11).
