First quarter 2019 turnover with CHF 91 bn almost at previous year’s level
Turnover of Swiss structured products recorded by the largest SVSP members slightly declined in the first quarter of 2019. The sector saw turnover in the first quarter of 2019 to reach CHF 91 bn, a slight decrease of CHF 1 bn or 1% relative to the previous year. Yield optimisation products (46%) were in particular demand, followed by leverage products (19%) and participation as well as capital protection products (18%). More than half of product turnover (52%) is based on equities, 26% on foreign exchange. The most important currencies for structured products were USD, EUR and CHF, accounting for 87% of the total turnover.
Zurich, 20 May 2019. Structured product value creation statistics drawn up by Boston Consulting Group take account of stock market listed as well as unlisted products created in or for Switzerland that are sold nationally as well as internationally. SSPA members Barclays Capital, Banque Cantonale Vaudoise, Commerzbank, Credit Suisse, Goldman Sachs, Julius Baer, Leonteq, Notenstein La Roche, Raiffeisen, UBS, Vontobel as well as Zurich Cantonal Bank took part in the survey for the first quarter of 2019. These represent the largest part of the Swiss market.
Most important developments in the first quarter of 2019:
- Total turnover of CHF 91 bn is slightly lower than the CHF 92 bn turnover in the prior-year quarter; growth rate compared to Q1 2018 was -1%.
- Despite a slight decrease in nominal turnover compared to Q1 2018, yield enhancement products accounted for approximately half of total turnover in Q1 2019 (46%); leverage products constituted the second-largest product group with 19% of total turnover, despite a 20% decrease in nominal turnover compared to Q1 2018. The nominal turnover of participation products increased in Q1 2019 by 19% to CHF 16 bn and increased their turnover share to 18% (prior-year quarter: 15%). Capital protection products made up 18% of total turnover in Q1 2019, representing an increase of nominal turnover of 32% compared to Q1 2018.
- With 52%, Equity products constituted the largest portion of total turnover inQ1 2019 despite a nominal turnover decrease of 7% compared to prior-year quarter; the turnover share of Foreign Exchange products declined by 1 percentage point compared to Q1 2018 and reached 26%. On the contrary, the share of Fixed Income products rose to 16% (previous year: 12%).
- Non-listed products constituted about 64% of turnover in Q1 2019; while nominally increasing by 5% to CHF 58 bn compared to Q1 2018, the turnover increased its share by 3 percentage points; the nominal turnover of listed products fell by 10% compared to prior-year quarter.
- Turnover on the primary market grew by 4% to CHF 53 bn compared to prior-year quarter and its share rose by 3 percentage points to 58% compared to Q1 2018. By contrast, turnover on the secondary market declined from CHF 41 bn in Q1 2018 to CHF 38 bn in Q1 2019.
- USD is again the predominant currency in Q1 2019 with a share of40%, but lost 4 percentage points compared to previous year. The share of EUR increased by 5 percentage points compared to Q1 2018 to 32%, CHF also gained share and reached 15%.
SSPA Chairman Georg von Wattenwyl on developments within the sector: “After a comparatively strong first quarter in 2018, we are pleased that the only slightly lower turnover in the first three months of this year confirm the continued consistent demand for structured products. Although the turbulence of the fourth quarter has partly unsettled investors, they value attractive and innovative investment opportunities in the portfolio context.”