Latest: DDV welcomes EU’s u-turn on inducements, questions restrictions on non-advised segment

The EU Retail Investment Strategy, released by the European Commission on 24 May, needs to be designed in such a way that it will have a “markedly positive effect” on the block’s securities culture, according to the German Derivatives Association (Deutscher Derivate Verband, DDV).

'It is important that the differing expectations and situations of investors are taken into account in both the advised and non-advised business segments,' said Dr Henning Bergmann (pictured), CEO of the DDV.

The Retail Investment Strategy and its further specifications have to be geared to the needs of all investors in order to further promote securities culture and facilitate access to securities investments - Henning Bergmann, DDV

The association welcomed the EC’s decision to refrain from a total ban on inducements and does not intend to impair the provision of securities advice at banks and savings banks.

However, the DDV has questioned the proposed restrictions in the non-advised business segment, also known as the self-directed segment, in which investors decide for themselves which securities they want to purchase.

According to the association, even in the non-advised business segment, inducements can bring added value or provide additional services to investors.

This aspect should be taken into account in the further deliberations of the European Council and the European Parliament, according to Bergmann

'The Retail Investment Strategy and its further specifications have to be geared to the needs of all investors in order to further promote securities culture and facilitate access to securities investments,' he said.

The DDV said it will support the EC‘s goals to simplify investor information and supervise digital media which have been delegated to Level 2, where the European Supervisory Authorities (Esas), in particular Esma, will take over their formulation.

According to Bergman, the success of the RIS will largely depend on finding practical solutions at Level 2.

'It is important to provide investors with clear and appropriate information and to take advantage of the opportunities presented by digital transformation,' said Bergmann, adding that in this context, it would make sense to 'distinguish between the different types of investors, as well as their different investment goals and motives.'

Stableton launches AMC on unicorn with Swissquote, Morningstar  

Stableton Financial, a Swiss fintech platform and investment firm, has launched two investment products that aims to broadly reflect the holdings of a private market index and gives institutional and private investors, including retail investors, easy and convenient access to the top 20 unicorns.

The products comprise a bankable actively managed certificate (AMC) with a Swiss ISIN, available for public distribution to retail investors, and an open-ended Luxembourg investment fund, available to institutional investors. For the AMC, Swissquote acts as Stableton’s official launch partner in Switzerland for retail investors.

'The Stableton Unicorn investment offering is based on Stableton’s experience with venture capital-backed growth equity and institutional-grade investment solutions and is enriched by Morningstar Indexes expertise in data and analytics, responsible for calculating a custom unicorn index, which is the key input into the products’ investment strategy,' stated Stableton on 15 May, which is headed by CEO Andreas Bezner (right).

Japan's Osaka Exchange introduces ESG index futures

On 30 May, six new derivative products went live on Osaka Exchange, owned by Japan Exchange (JPX). They're Nikkei 225 micro-Futures, Nikkei 225 mini Options, three-month TONA Futures, S&P/JPX 500 ESG Score Tilted Index Futures, FTSE JPX Net Zero Japan 500 Index Futures, Nikkei 225 Climate Change 1.5℃ Target Index Futures.

The first two products feature contract units that are one-tenth of the existing Nikkei 225 mini and Nikkei 225 Options to reduce the notional amount. 'In recent years, a trend toward smaller investments in the cash equity market has increased demand for more precise risk management tools,' said Ryusuke Yokoyama (right), president and CEO of Osaka Exchange.

The three-month TONA futures are designed to allow investors to trade the Tokyo Overnight Average Rate (TONA) and build a market that fully enables price discovery in view of an increasing need for a term risk-free rate for Japanese Yen in Japan.

'As set out in its Medium-term Management Plan, JPX aims to contribute to the realization of a sustainable society by providing solutions that utilize market mechanisms to address a wide range of societal issues,' said Yokoyama referring to the three ESG or climate-related index futures.

In the meantime, Singapore Exchange will roll out five futures on the MSCI Climate Action Indexes on 8 June, as SRP reported.

Leverage Shares adds 15 ETPs on LSE

Leverage Shares, a US issuer of exchange traded products (ETPs), has introduced new ETPs on London Stock Exchange (LSE) on 18 May after achieving 'a record monthly turnover' of more than US$420m across its product range in February.

Among the listings above are several firsts for the company, including a FAANG+ basket ETP and Short & Leveraged (S&L) ETPs tracking Fixed Income.

The basket ETP is the first pure play providing physical, concentrated exposure to a group of leading technology stocks for European investors. With this new ETP structure, the company is able to eliminate ‘fillers’ that are common with UCITS ETFs, which have concentration restrictions, and provide non-diluted exposure to US tech leaders. 

Leverage Shares is also launching 'an innovative actively-managed strategy' that seeks to capitalise on the 'contango’ of the volatility curve, while managing the risk of dramatic volatility spikes.

MerQube UK receives FCA authorisation as benchmark administrator

The subsidiary of the US technology provider for indexing and rules-based investing, has been authorized by the Financial Conduct Authority (FCA) to carry on the regulated activity of administering benchmarks under Article 34 of the Regulation (EU) 2016/1011/EU) – Benchmarks Regulation (UK BMR).

The FCA authorisation will allow MerQube to provide benchmark services to its clients in the UK, stated the firm on 18 May.

'By successfully registering for this globally respected regulation we can further accelerate our plans to roll out the provision of high-tech support and services to our indexing clients in the UK and throughout Europe,' said Roby Muntoni (right), CCO at MerQube and CEO at MerQube UK.

SRP registers 724 retail structured notes linked to three Merqube indices – the MerQube US Tech+ Vol Advantage Index (443 products, US$238.4m), MerQube US Large-Cap Vol Advantage Index (215, US$73.9m) and MerQube US Small-Cap Vol Advantage Index (66, US$0.16m).

US Fixed annuity sales double in Q1 23, driving record sales

Total US fixed annuity sales increased 101% to US$70.9 billion in Q1 23 year-on-year (YoY), and every major fixed annuity product line delivered at least double-digit growth, according to the Q1 23 Individual Annuity Sales Survey from the Life Insurance Marketing and Research Association (Limra).

'There are several factors driving the record-level growth in the fixed annuity market,' said Todd Giesing (right), assistant vice president, Limra Annuity Research.

'Continued equity market volatility and favorable interest rates coupled with investor concerns about the banking sector and a potential recession have made fixed annuities an attractive choice to shield assets, generate protected growth and establish guaranteed income for retirement.'

Overall annuity sales totaled US$94.1 billion, a 49% increase YoY. Accounting for 44% of all annuity sales, fixed rate deferred (FRD) annuity sales jumped 161% to US$41.5 billion in the first quarter. This is the fourth consecutive quarter of record-breaking sales.