The Hang Seng China Enterprises Index (HSCEI) is one of the most popular underlyings in the global structured products market, with over 60,000 products sold, of which some 16,000 are still live, and are expected to return hefty sums to the market in the near future, according to the SRP database.

There are over 6,000 products with a Knockout feature that are pegged to the HSCEI, with aggregate estimated sales volume of just under US$28bn, according to the SRP global database. The vast majority of those are South Korean products, representing some 80% of the segment, though there are also sizable tranches in European markets, such as Austria, Germany and Sweden.

If the HSCEI climbs more than 15% from its current level by year's end, as much as $25bn would be returned to investors from these products in repaid principal plus capital gains by the year's end, according to SRP estimates.

The month of September would be particularly prolific in terms of early maturities, though it would require the HSCEI to maintain a level above some 90% of its current level. August has significantly larger potential for early maturities in the event that the HSCEI drops up to 30% of its current level.

In terms of number of products, nearly 1,000 tranches could autocall in September, as compared with 613 in August. June and July are at 846 and 670, respectively, while the last three months of the year have about 900 potentially early-maturing products each.

A research note earlier this year by Societe Generale pointed out that products issuance in Japan and South Korea has been increasing dramatically after the global rally in equities following the election of Donald Trump as US president triggered autocalls in a greater number of products, prompting demand for rollovers.

In terms of natural maturities, a total of some 3,820 products expire before the end of the year, bringing some $11bn back to the market, according to the SRP database.

The HSCEI has been one of the most popular underlyings in recent years, with only the European, US and Korean benchmarks ahead of it in terms of underlied sales volumes.

In a separate report earlier this year, SRP's analysis showed that knockout products linked to the Eurostoxx 50 will return an estimated US$11bn to the market, if the European benchmark maintains its level until the end of the year.

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