Traditionally, a hybrid product was any financial instrument that blended characteristics of debt and equity markets. An example would be convertible bonds. Today, that definition may be stretched to include instruments that blend aspects of other markets as well. Structured finance has produced a host of innovative hybrid products, some of which have sizeable markets. Examples include

trust preferred securities (TruPS), which are widely issued by banks as a tax-advantaged means of raising capital,

equity default swaps, which are a natural extension of credit default swaps, and

volatility futures, which have a volatility index as their underlier.

This book is an edited collection. Twenty four authors have contributed twelve chapters on hybrid products—their use, structures, pricing and risk management. The bad news is that there is no integration between chapters. They don't refer to one another, nor do they build upon each other. They are like a random grab bag of chapters on hybrid products, ranging from a painfully elementary chapter that explains what volatility and correlation are to a fairly sophisticated chapter that invokes copulas for assessing risk in CDS/EDS correlation products.