Deutsche Bank, JP Morgan Chase Slate New Derivatives Products

PDCA technology enables financial intermediaries to provide new derivatives and risk management products to their customers without assuming the market risks customarily associated with risk transfer, according to the companies.

JPMorgan, the investment bank arm of JPMorgan Chase, has signed a letter of intent for the exclusive rights to create products based on economic statistics published by the US government and US government agencies.

Similarly, Deutsche Bank has signed a letter of intent for exclusive rights to use Longitude’s PDCA technology to create derivatives based on economic statistics published by the European and the Japanese governments.

These products, which are slated for launch by the two banks before the close of 2001, will allow investors explicit, as opposed to implicit, pricing and trading of economic factors, such as inflation and productivity, which impact a wide range of asset classes.