In the second quarter of 2019, there were 99 new reports published on individual UK structured products. The amount of providers in the market still remains higher than previous years, with 11 providers releasing products during this quarter. The total number of products issued is slightly down as providers streamline their offerings somewhat and concentrate on the most popular product types The high number of active providers is a sign that the market remains healthy and competitive.
The largest provider is again Investec Structured Products with 28 products, with 28% of all products reported this quarter. Meteor was not too far behind though, as they have increased their number of products to 23 this quarter, accounting for 23% of all products reviewed.
There were 80 auto calls issued this quarter out of the total of 99 products, making it by far the most popular product type. Defensive auto calls continue to be the favourite amongst issuers, as they represented 45% of all products reported during this quarter.
Auto-calls remain popular for their clear message and strong historical performance. They are the cornerstone of the attractive returns that UK structured products have generated as we described in an earlier article here.
The average length of autocalls has reduced somewhat, both by maximum maturity and expected maturity (duration) which has fallen below two years. As products of 6 and 10 years vary in popularity these averages fluctuate accordingly. The vast majority of products (84%) were linked to single UK equity indices, predominantly the FTSE 100, whereas the rest of the products consisted of dual indices, with a single product being linked to three indices.
The spread of issuers was down on the previous few quarters. There were eight well known investment banks issuing this quarter, all of whom have been active in structured products markets for many years.
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