The physical property market is worth more than $12,000bn worldwide and most sizeable asset management institutions will have some exposure to this asset class. Yet, until recently, the opportunities to hedge against property investment were extremely limited. Of course, asset-backed securitiesrnhave been around for many years - and securitisation in the US subprime market has been the cause of untold misery in the markets over recent months. But the property derivatives market is different. It only really began a couple of years ago, it is still in its infancy, and the UK is leading the way.
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