Risk, according to Warren Buffett, “comes from not knowing what you are doing”. It is no wonder then that the pension fund community, which has long been a proponent of plain vanilla equity and bond investing, finds the structured product market risky.

“Demand has always typically been low for structured asset-type products, other than in asset classes such as commodities,” says Nigel Cresswell, a former executive director at Lehman Brothers Pensions Advisory Service, whose job it was to sell structured products to pension funds. “Investors are shy about using them and don’t understand them.