Societe Generale has issued its first turbo certificates in the Netherlands. The launch of the SG Turbo Best follows the introduction of the Daily Bull & Bear certificates in July and the French bank is looking to issue more, according to Ernst Gevaerts (pictured), head of cross asset retail distribution sales the Netherlands at SG. "We are looking to introduce products which are already successful in the surrounding countries," said Gevaerts.

The SG Turbo Best, which has no fixed maturity date, differs from regular turbos in the sense that the financing level and stop-loss level is the same, according to Gevaerts. "Best stands for 'Barrier equals strike'," he said. "The classic turbos have a financings level and stop-loss level which is different. Take, for example, a turbo long: for those products the stop-loss level is higher than the financing level and, for a turbo short, it is the other way round. In the case of a turbo best, both [financing level and stop loss level] are the same," said Gevaerts.

The best turbo, also known in the Netherlands as booster, trader, turbo XL or sprinter best, has become the most popular by some distance, according to Gevaerts. "For Societe Generale, it was, therefore, a logical choice to start producing them in the Netherlands."

As of December 12, 2016, SG had issued 92 best turbos, of which 42 are linked to single indices (AEX, Dax), while the remaining 50 are linked to well-known Dutch shares, such as Aegon, ING, KPN, Philips and Royal Dutch Shell, among others. "We have started with the best-known equity underlyings and will probably introduce additional underlyings, such as commodities or currencies," said Gevaerts. "For now, we have started with indices and shares because that's where we are receiving most requests from investors.

"Of course clients, and when I speak about clients I mean the sophisticated retail investors, can always contact us to request a turbo on an underlying they think is interesting," said Gevaerts. "If, in terms of liquidity and also commercially, it is possible to create a turbo on that particular underlying, then we certainly would look at it."

The market for leverage products in the Netherlands is highly competitive, with Binck, BNP Paribas, Citi, Commerzbank, Goldman Sachs, ING and now SG all vying for a share. "Once we have started the marketing push, which will be in 2017 and in which we also include the Daily Bull & Bears, we intend to become one of the key listed product providers for Dutch retail investors," said Gevaerts.

Turnover of structured products at Euronext Amsterdam stood at €9.2bn in 2015 (excluding figures for Binck turbos, which are traded via the Cats platform), however, according to data provided by the European Structured Investment Products Association, volumes for the first nine months of 2016 only reached €3.8bn. Gevaerts thinks the lower volumes are partly caused by the relative stability of the financial markets in 2016: "Apart from exceptional movements around the Brexit and US elections' votes, there has been little volatility in the market and that's probably why the volumes are a little bit less."

Click the link to view the SG Turbo Best brochure.

Related stories:

SocGen enters Dutch market with daily certificates, turbos on the cards

SG moves to bolster listed products franchise in The Netherlands