 The note holders would be the natural counterparty for the hedge, but they don't take part in this market (similar to buyers of portfolio insurance in 1987).This situation often creates "one way markets" and sometimes liquidity squeeze situations in long term FX volatilities, basis swaps or long end AUD interest rate swaps.The volume of PRDC notes issued has been so large that the hedging and rebalancing requirements far exceed the available liquidity in several key markets.