Third quarter 2020 with slight turnover decrease to CHF 86 bn
Turnover for Swiss structured products of the major SSPA members amounted to CHF 86 bn in Q3 2020, which is CHF 8 bn lower than in the prior-year quarter (CHF 94 bn). The growth rate compared to Q3 2019 was -9%. The turnover of the first nine months of 2020 grew by 8% to CHF 289 bn compared to the same timeframe in 2019. Yield enhancement products represented 46% (CHF 39 bn) of total turnover in Q3 2020. Leverage products constituted the second-largest group with a turnover share of 31% (prior year: 17%). Turnover share of participation products decreased from 28% in Q3 2019 to 13% in Q3 2020. Capital protection products made up 10% of total turnover in Q3 2020 (prior year: 11%). The nominal turnover of CHF 43 bn on the primary market remained almost unchanged compared to Q3 2019, however the turnover share rose to 51% (prior year: 47%). The turnover on the secondary market decreased from CHF 49 bn in Q3 2019 to CHF 42 bn in Q3 2020 and reached a share of 49% of the total quarterly turnover. The most important currencies for structured products are USD, EUR and CHF, with a total share of 88% of turnover.
Zurich, 29 October 2020. Structured product value creation statistics drawn up by Boston Consulting Group take account of listed as well as unlisted products created in Switzerland that are sold nationally as well as internationally. The SSPA members Banque Cantonale Vaudoise, Barclays Capital, Credit Suisse, Goldman Sachs, Julius Baer, Leonteq, Raiffeisen Switzerland, Société Générale, UBS, Vontobel and Zürcher Kantonalbank took part in the survey for the third quarter of 2020. They represent the majority of the Swiss market.
Main developments in the third quarter of 2020:
- Yield enhancement products represented 46% (CHF 39 bn) of total turnover in Q3 2020, an increase by 2 percentage points compared to Q3 2019. Leverage products increased their turnover to CHF 26 bn (prior year: CHF 16 bn), and constituted the second-largest group with a turnover share of 31% (prior year: 17%). Turnover share of participation products decreased from 28% in Q3 2019 to 13% in Q3 2020, the nominal turnover fell sharply from CHF 26 bn to CHF 11 bn. Reaching CHF 9 bn turnover, capital protection products made up 10% of total turnover in Q3 2020 (prior year: 11%).
- Despite decrease of the nominal turnover from CHF 55 bn in Q3 2019 to CHF 48 bn in Q3 2020, equity products held the largest turnover share with 56% (prior year: 58%). Nominal turnover of foreign exchange products decreased from CHF 22 bn in Q3 2019 to CHF 21 bn in Q3 2020, however the turnover share rose slightly from 23% to 24%. The turnover share of fixed income products decreased from 11% in Q3 2019 to 10% in Q3 2020, the nominal turnover fell from CHF 10 bn to CHF 9 bn. Commodity products doubled their turnover share compared to the prior-year quarter from 3% to 6% in Q3 2020, but remained on a low turnover level.
- With a nominal turnover of CHF 53 bn in Q3 2020, non-listed products constituted 62% of the total turnover, resulting in an increase by 7 percentage points (prior year: 55%). The nominal turnover of listed products decreased compared to the prior-year quarter from CHF 42 bn to CHF 32 bn, the turnover share reached 38%.
- USD was the predominant currency in Q3 2020 with a share of 44%, increasing by 7 percentage points compared to the prior-year quarter. The share of EUR decreased by 3 percentage points to 32% compared to Q3 2019, CHF lost considerable share and reached 12% (prior year: 18%).
SSPA chairman Markus Pfister comments: «The third quarter again showed that investors are taking advantage of market opportunities and appreciate the flexibility of structured products. On the one hand, risk-averse investors are using yield optimization products in order to benefit from additional earnings due to the increased volatility. On the other hand, risk-adverse investors are increasingly using leveraged products to efficiently reflect their assessment of market developments.»
Click on the link below for the full set of statistics: http://www.sspa.ch/media/Download PDF