BH Securities (BHS) has delivered a 19.5% yield after its WO Autocall Memory Note matured early after 18 months.
The note, issued by ING and linked to four automotive companies (BMW, Daimler, Porsche, Ford) paid three coupons valued 6.5%, earning investors 12.62% pa (compounded), when the average interest rate on deposits is 1.3%. “It’s always our investment committee that comes with the business idea suitable for our clients,” said Jan Pirich, structured products solutions manager at BH Securities. “We then pitch it to eight or ten investment banks and the two that return with the best solutions are shortlisted.”
The Czech brokerage house is an active provider of structured securities and has been marketing at least one or two products every month. The clientele of the brokerage house is mostly high net worth investors with average ticket sizes at CZK300,000 (€10,000). “All our so-called retail products are published on our website; we also offer tailor-made and institutional solutions,” said Pirich. “Those products, however, are behind closed doors, as they are unique investments prepared for one or two clients.”
Only a few of the products launched have been listed on stock exchanges, with recently issued products purely OTC, and, so the reason for not listing in the secondary market is exclusivity, said Pirich. “Our clients still can redeem their investment earlier if they wish to, but our products are not listed to simply keep them inhouse and accessible only to our clients,” said Pirich. “Once the offer on the primary market is closed, not additional purchase is available.”
Although the firm has an open architecture set up and offers products from various issuers, Leonteq seems to be gaining market share, according to Pirich. ”They offer the best terms; they’re fast in trading; and offer the best support, including pricing,” said Pirich “Their platform Constructor is also a very good tool, which we make the full use of it.” All the products sold by BH Securities since the summer last year were issued by Leonteq.
According to SRP database, the brokerage house has 25 retail products in its portfolio.
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