What's happening

 IPF set up The Property Derivatives Interest Group (PDIG) in 2004 to support the development of a deep and liquid national and international market in property derivatives. 

PDIG organises four breakfast events each year at which the quarterly derivative trading volumes are announced by IPD.  For more information on the next PDIG breakfast, please click here.

New RBS report on trading property derivatives via Futures

Exchange Traded Property Derivative Futures 

The RBS trading desk have published a report detailing the Exchange Traded Property Futures Market, the first report of its kind on this subject.

RBS consider that there are distinct advantages for someclients trading property derivatives via Futures, 

as opposed to the more common property swap market.  These advantages are:

  • Virtually eliminates counterparty/credit risk;
  • Independent monitoring and reporting of trades;
  • Faster Trade execution;
  • Potential for better price execution; and
  • Greater comfort from a regulatory perspective

Nick Scarles steps down from derivatives role

The Investment Property Forum has appointed Will Robson, director of property derivatives at PRUPIM, to succeed Grosvenor’s Nick Scarles as Chair of the Investment Property Forum’s Property Derivatives Interest Group (PDIG).


New PDIG Structure.....take a look


Review the report launch presentations .....

"Trading Property Derivatives" - NEW RELEASE

The Trading Property Derivatives handbook picks up where Getting into Property Derivatives left off. The earlier publication sought to tackle some of the hurdles encountered by many property investors wanting to participate in the property derivatives market. This new handbook takes the reader one step further and aims to provide more practical tips and advice on how to tackle the issues involved in getting an organisation to the stage where it can trade derivatives routinely.  

"Getting into Property Derivatives" - Report UPDATED

The Technical Sub-group are pleased to announce the release of an update to this important document originally launched on the 17th November 2008. For a copy of the report and to view the original slide presentations at the launch meeting follow the link below.
 

Perspectives on Property Derivatives Pricing

IPF Events

Event Full   Date: 28 September 2010

At a packed presentation, the presenters delivered three very informative papers that demonstrated:   

  • Property derivative pricing can largely be explained through a combined understanding of financial derivatives and the underlying property market.
  • The factors which affect pricing for the short dated periods are different from those which affect medium term contracts.
  • The stage of development the market has reached, presents "mispricing" opportunities for those who understand physical property and derivatives
  • Physical players are able to glean useful insights into the physical markets by observing and understanding derivative pricing.

Event Outline
Over recent years, as the property derivatives market has developed, there have been various attempts by academics to use standard financial theory to describe how property index derivatives should be priced. The difficulty has been to reconcile this with reality and to rationalise how property derivatives are actually priced in reality.

Read more...

What's going on with sector derivatives

BRETT SCOTT from Hoare Capital Markets discusses the company’s experiences in sector and sub-sector property derivatives brokerage

UPDATED - March 2010
 
To read this comprehensive update click here
      

 

  
Sign up now for free membership to the PDIG mailing list
 
  

Indicative Pricing - Commercial Property

 Date
 1 Year
 2 Year
 3 Year
 4 Year
 5 Year
8 April 11
475
450
483
499
506 

Implied Return - All UK Total return     Price Pages

 Date

2011    

 2012

 2013

 2014

 2015

8 April 11

 4.75%

4.25% 

 5.50%

5.50%

 5.50%

Recent News

  • New RBS report on trading property derivatives via Futures The RBS trading desk have published a report detailing the Exchange Traded Property Futures Market, the first report of its kind on this subject.   RBS consider that there are distinct ...
    Posted Apr 11, 2011, 5:43 AM by Colin Barber
  • Nick Scarles steps down from derivatives role The Investment Property Forum has appointed Will Robson, director of property derivatives at PRUPIM, to succeed Grosvenor’s Nick Scarles as Chair of the Investment Property Forum’s Property Derivatives ...
    Posted Mar 29, 2011, 12:36 PM by Colin Barber
  • 260 participants in PDIG Trading game The PDIG Trading Game, which will run for 8 weeks and conclude with an event on Monday, 28 March has signed up 57 teams, with 260 participants.
    Posted Jan 27, 2011, 2:48 PM by Colin Barber
Showing posts 1 - 3 of 21. View more »
 

Report of recent Q3-09 Breakfast

See the presentations from our November Breakfast.
 

Eurex Launches Europe's first Property Futures Exchange

The international derivatives exchange Eurex launched Europe’s first property futures on 9 February 2009. The futures are annual contracts based on the total returns of Investment Property Databank’s IPD® UK Annual All Property Index for individual calendar years.
 
View the Launch presentations from 27th January 2009 here 
 
 

Important Seminar - Why aren't you using property derivatives yet?

The investment case for property derivatives has been well made over recent years by their proponents in banks, brokerage houses and property investment firms alike.  Despite this, the take up in their use by property ’end users’ has been slower and more limited than expected. 

 

This morning seminar explored the reasons for this in a live debate of the issues chaired by Nick Scarles (Chairman of the IPF's PDIG and Grosvenor Finance Director).
    

To view the presentation delivered - click here  full details

 

Come to the next Breakfast Meeting

For details of the next discussion of property derivatives and trading volumes follow the link
  

Latest 2009 Full Year Trading Volumes

The full year results for 2009 were released on 1st February 2010

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