Florida-based Bonds.com, the owner of online fixed-income product platform Bond Station, plans to add an array of structured retail products to its offerings in the near future.
The firm has hired Mark Kolodzinski as director of structured products to lead the new initiative. Kolodzinski moves to this position from Countrywide Securities, where he worked as director of dealer sales. In 2000, he helped to develop a structured products desk for a regional broker/dealer. Bonds.com hopes to have a team of ten to 15 regional salespeople in place by 2009, with four field reps already in place.
Though the firm began offering structured products last December, it has seen additional interest in recent months.
“We have had a tremendous amount of reverse inquiries,” Bonds.com CEO John Barry told SRP. “We realised that eventually we wanted to roll into this product segment.” Until now, Bonds.com offered only plain vanilla fixed-income securities (specifically corporate agency securities, corporate retail notes, municipal bonds and fixed-rate certificates of deposits).
Adding structured retail products (including commodity-, currency-, equity- and interest rate-linked securities), allows Bonds.com to help clients diversify their portfolios beyond fixed-income products and gives the firm a whole new revenue stream and business to grow, Barry said: “Bonds.com can offer the one-stop-shopping everyone is looking for.”
Listing products on its Bond Station platform will be free for companies, with the firm generating revenue through mark-ups on transactions or through selling group agreements with product manufacturers and issuers, Barry said.
Kolodzinski added that since he officially joined the firm in late June, he has received a warm welcome from product manufacturers, issuers and distributors, as they seek to increase their product distribution.
Its goal will be to distinguish Bonds.com from other structured product distributors, mainly by offering an interesting and robust line-up of products that will include principal protected notes, leveraged return notes, steepener notes, yield inversion notes, and equity index-linked CDs, which have seen great growth and are quite popular at the moment, Kolodzinski said.
Absolute return barrier notes are also in favour, as investors seek securities that can take advantage of the current sideways stock market, he added.
However, the company announced that it won’t be competing with other companies by distributing reverse convertible securities. “The reverse convertible market seems to be pretty much saturated,” said Kolodzinski.
