Leonteq has been playing an active part in the development of the Swiss market for structured products for more than 15 years. The listed fintech company is now fulfilling the same role in the Exchange Traded Product (ETP) segment as well with the introduction of the ETP+ label. One of the aims of this innovation is to improve security for investors. ETPs are passive investment instruments that track a specific underlying asset. To date they have largely been issued by special-purpose vehicles which usually have neither a proven track record nor a rating or are subject to regulatory monitoring. Leonteq brings a strong capital base alongside many years of experience. As a securities firm, the issuer of the new ETP+ is also licensed by FINMA and comes with an investment grade rating from FITCH.
The ETP+label offers another major point of differentiation: the type of collateralisation. To reduce the issuer risk and give greater protection to investors’ capital, Leonteq is joining forces with the SIX Group, which will act as depositary and monitor the product collateralisation on an ongoing basis. While SIX SIS AG holds the collateral, SIX Repo AG oversees the day-to-day monitoring of the deposited funds. Behind the investment solutions bearing the ETP+ imprimatur, then, is proven technology. The collateralisation process of SIX has been in use successfully for ten years already.
Leonteq is also opting for experience and reputation when it comes to the underlying for the first ETP+: it tracks the FuW Swiss 50 Index NTR. This stock market barometer, developed by the editors of Switzerland's leading financial publication, “Finanz und Wirtschaft” (FuW), contains the 50 biggest listed companies in Switzerland. To that extent the ETP+ on the FuW Swiss 50 Index NTR offers both institutional and private investors a diversified way into the domestic equity market. This requires only a small capital commitment – the ETP+ is currently trading at around CHF 26.
Source: Leonteq
