Hong Kong pioneers property derivatives in Asia

A landmark property derivative trade between ABN AMRO and Sun Hung Kai could open the door on a market worth billions of dollars.

ABN AMRO Bank and Sun Hung Kai Financial have traded AsiaÆs first property derivative. The transaction, brokered by GFI Colliers, is based on the University of Hong Kong Real Estate Index Series and is the first deal of its kind anywhere in Asia.

It is a one-year trade in which ABN AMRO receives a coupon based on the returns of the index and, in return, pays Sun Hung Kai Financial a spread over Hibor. The exact details of the transaction...

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