Banco Invest has launched the first product in Portugal to feature the S&P Euro index in a move to expand the pool of underlying assets offered in its range.
This is not the first time the Lisbon-based bank has introduced new underlying assets: in 2013, the Portuguese provider issued Invest Security, a one-year deposit linked to the Prosegur Cia de Seguridad, which delivered 108.38% of the initial investment at maturity; and, in July, it launched Invest Recursos Naturais, a one-year structure linked to the S&P Commodity Producers Agribusiness index and the S&P Global Timber and Forest index, which also delivered 108.38% at maturity.
"By using the S&P Euro Index, we seek to differentiate our products and benefit from characteristics that we believe are potentially positive for customers," said Humberto Pinto, derivatives portfolio manager at Banco Invest. "The S&P Euro allows for great diversification in terms of number of companies and a more balanced sector exposure than other more commonly used indices."
Invest Valor Mundial is an 18-month deposit, offering the return of capital invested plus 50% of the S&P Euro growth at maturity, subject to a maximum of 106.5%. The S&P Euro is a sub-index of the S&P Europe 350 and includes all Eurozone domiciled stocks from the parent index. The benchmark is designed to be reflective of the Eurozone market, and easy to replicate. "In a low interest rates world, where we see a growing interest for structured products from our clients and fierce, global competition within the industry, innovation is absolutely crucial," said Pinto. "In this context, we [want to] keep offering innovative products, not so much in terms of payoffs, because retail clients prefer simple [structures], but in terms of themes and underlyings."
The goal at Banco Invest is to build products that are consistent with the bank's recommended asset allocation and views for the financial markets, said said Pinto. "Once we have defined the theme for the product, we seek the best underlyings in order to differentiate [ourselves] from the competition and maximise the returns to our clients."
Banco Invest will continue to concentrate on global stock baskets and in sectorial and thematic indices, said Pinto. "The key for success is to offer good investment stories and simple and understandable structures for clients," he said.
The bank marketed 16 structured deposits last year, ranking it sixth most frequent provider of products in Portugal, with the average return of Banco Invest's products that matured in 2014 at 7.6% pa.
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