The delta one ETF landscape

  The words ‘delta one’ might sound rather like a call sign from a war film, but in the world of finance they have a rather more prosaic meaning.  A delta one product is a derivative that faithfully tracks the performance of an underlying asset. If the underlying asset increases by 1%, then a delta one product increases by 1%. In other words, it has a delta, or sensitivity to the price of the underlying asset, of one. Swaps and futures can give this type of exposure, as can plain vanilla ETFs that track a market index without gearing or leverage. But swaps, futures and ETFs have a num...