29.04.2015

Structured products innovate despite the difficult environment for success

The structured product industry started in 2015 with turbulence, but this also brought new opportunities. In early January the SNB came out with its unexpected decision to abolish the euro minimum exchange rate; and negative interest rates did the rest. But the waves of high volatility didn’t just hit investors, businesses and analysts; as the structured products market was also put into turmoil. Although these were far from ideal conditions, the issuers of structured products showed innovative flair: New structured products were issued in response to the turmoil, so as to be able to provide investors with even greater protection in the future – simply, this was a “lesson learned”. So in the present deep negative interest conditions, more than ever, structured products provide an interesting investment choice with attractive conditions. With this in mind, the following SSPA newsletter will periodically report on the development and trends in the structured products industry and the efforts of the association.

Simple, understandable and comprehensive knowledge transfer and information provision form the core of the SSPA’s association work. Target group orientated information should allow interested parties to pick up on their knowledge and be customised to their needs. This is how awareness & acceptance and the general reputation of the structured products brand should be improved alongside supporting the sale of structured products in Switzerland. The SSPA would also like to put its focus on authorities & economy and use targeted public affairs activities to clear up prejudices and misunderstanding surrounding structured products. By the end of the year, some politicians should know of the SSPA and its purpose. No less ambitiously, the association will strive to recruit new members through active advertising. And further planning includes an extended membership structure composed of issuers, buy-side and partners, who will recognize the SSPA as a “seal of approval” which provides added value.Opportunities for information and dialogue among experts were offered for the first time at the beginning of February at Finanz’15 – the combined finance fair for funds and structured products following the motto of “Investments of the future”. Through the merger of both previously separate fairs, Finanz’15 will be the biggest exchange and information platform for residents in Switzerland. Successive improvement in transparency is a promising future but also a key concern of the association. All issuers disclose the distribution fees of their products since 1 March 2015, and openly provided details of the included product fees in their sales prices. In this way, as an investor, you will know of any monetary incentives received by distributors for product distribution.

Georg von Wattenwyl, SSPA President

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