Leonteq brought the ETP+ label into life around six months ago. In the “+”, the Zurich-based financial boutique seeks to express its aspiration of developing the market for exchange traded products (ETP) further. At the core is improved protection for investors. To date many ETP issuers have been special-purpose vehicles with no rating and under no regulatory supervision. What is more, these providers are frequently backed by only the bare minimum of financial resources. Leonteq, by contrast, comes with a capital base of around CHFmn 930 as at the end of 2022, while it also offers a 15-year track record as a successful issuer of structured products. The company was the first ETP provider in Switzerland to be licensed and monitored by FINMA as a securities firm. It also enjoys an investment grade rating from Fitch Ratings Ltd. and an “A” ESG rating given by MSCI.
A second advantage of ETP+ lies in the type of collateralisation. Here Leonteq is cooperating with the SIX Group, with a pledge being deposited with SIX SIS AG for every product. The depositary agent ensures that investors have access to these funds in the event of the issuer becoming insolvent. Measures are also taken to ensure that the collateral is sufficiently large: SIX Repo AG undertakes a daily review and valuation of the securities. The system just outlined is not new – in fact, banks, insurers and pension funds have been using the interplay of depositary (SIX SIS AG) and collateral agent (SIX Repo AG) in a collateral management service offered by SIX since as far back as 2012.
It is not only for collateralisation that Leonteq is relying on strong partnerships – the issuer is also bringing expert support on board in terms of content. The existing cooperation with The Market has just been stepped up, with Leonteq having launched an ETP+ based on The Market Best Ideas Portfolio Index NTR. When it comes to valuation and analysis of the capital markets, The Market is a real powerhouse. Every day a team of experienced financial journalists analyses what is happening on global financial markets and in the business world. Their focus is always on the big picture and in-depth research from the point of view of the investor. Shutting out daily stock market chatter, the financial medium pursues the goal of identifying and highlighting relevant developments, important trends and exciting investment themes.
This expertise is bundled in The Market Best Ideas Portfolio. The editorial team has been systematically hunting for promising shares since March 2020. Some 70% of the Best Ideas Portfolio comprises blue chips, with managers able to invest the remaining 30% in riskier stocks. That enables the team to bet on turnarounds, for instance. The 70% blue-chip shares are made up of Swiss companies, while the remaining 30% is composed of international stocks. These more risky positions also number representatives of sectors that are normally under-represented in Switzerland. Current examples include the technology giant Microsoft and oil multinational Shell. These two instances alone show just how demanding the selection process for The Market Best Ideas Portfolios is: even the supposedly riskier components are notable large caps.
We look forward to answering all of your questions about our products and how they are traded. Please don't hesitate to get in touch! Phone: 058 800 11 11, email info@leonteq.com or contact us here.