Derivatives Offer Solution to Pricing Problem

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NEW YORK (HedgeWorld.com) - A year or two ago credit derivatives were criticized for lacking full documentation and transparency. So it is ironic that data from credit default swaps could be what the doctor ordered for valuation dilemmas in the current structured paper crisis.

Pricing techniques developed over the past couple of years will play a critical role in dealing with this crisis, argued Don Fewer, senior managing director at GFI Group, a large inter-dealer broker specializing in derivatives, at a press conference on Wednesday [Dec. 12].

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Derivatives Offer Solution to Pricing Problem

Loan credit default swaps are evolving to become a pricing mechanism for collateralized loans as the market deals with the fallout f...

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