The outstanding volume for bonus certificates and reverse convertibles in Austria increased by 16% and 17%, respectively, over the last six months, according to the latest figures from the Austrian certificate association (Zertifikate Forum Austria - ZFA). Demand for autocallables, however, remained low, while the trading volumes for listed structured products decreased, according to the ZFA. "We are experiencing a very intense phase of our business", said Heike Arbter (pictured), chairwoman of the ZFA. Arbter is also president of the European Structured Products Association (Eusipa) and head of structured products at Raiffeisen Centrobank.
Austrian investors are increasingly discovering the benefits of partially protected certificates, which have proven themselves in the situation of low interest rates, high price levels and low volatility, according to Arbter. "Partial protection certificates are currently the investment instrument with which investors can achieve attractive real returns at low risk."
The outstanding volume for bonus certificates was €878m at the end of June 2017, which is equal to 20% of the overall volume of investment certificates, while the outstanding volume for reverse convertibles, at €578m, amounts to 13% of the market.
Tracker certificates, with an outstanding volume of €179m, decreased by 8%, although discount certificates, with a volume of €5m, increased by 150% making them the best performing product over the first six months of this year. The sales volume of capital protected products increased by 3%, to €2.8bn, while open interest for leverage certificates increased by €8m, to €50m.
The demand for autocallables (or express certificates), which have proved popular in neighbouring Germany, is somewhat lacking in Austria, according to Arbter. "Austrian investors mainly use bonus certificates and reverse convertibles," said Arbter. "We cannot see any significant volume of express certificates on the overall market. We always find that the Austrian market differs from the German market."
Arbter expects the market to continue to develop positively for the remainder of this year. "If the demand situation does not change drastically, we expect a further continuous increase - similar to the first half-year - for investment products, primarily bonus certificates, reverse convertibles and also capital protected certificates," said Arbter. "We expect slight declines in interest rate products as we do not expect any change in interest rates."
Exchange turnover of structured products amounted to €107.2m in June, down 54.4%, or €128.1m, month-on-month and also down 32.2% (€50.9m) compared to December 2016.
Click the link to view the ZFA market report for June (in German).
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