Panelists discussed the growing role of structured products in portfolio construction at SRP Europe 2026 in London.
Structured products are becoming more widely adopted over the years from a portfolio construction perspective. That’s according to Varya Nuttall (pictured), director, senior investment advisor at Barclays Private Bank, during a panel discussion.
The most popular structured products are those which are already well documented and well known to clients - Varya Nuttall, Barclays Private Bank
Nuttall highlighted the core-satellite approach for structured products’ construction, where the core can be tapped into long-term equity or fixed income exposures, while using thematic exposures or hedging solutions for the satellite.
“I have to say that the most popular structured products are those which are already well documented and well known to clients, so reverse convertibles [for example], especially on the single [underlying] name. You’d need to see how it fits into the client’s profile and why you're doing that,” she said.
When managing family offices’ portfolios, private banks often manage part of their portfolios, the advisor said that banks can use a combination of structures, such as structured products and alternatives, to formalise a bespoke strategy. Meanwhile, rates-linked structured products can also be constructed for fixed income as part of 60/40 portfolio management, in addition to traditional bonds and bond funds, she pointed out.
Bevan Goulden, institutional and professional solutions at UK-based distributor IDAD, sees structured products as a way to provide “market access” to a specific underlying exposure.
He said his team tends to take a systematic and mandate-focused approach that looks for simple structures, such as reverse convertibles and autocallables, to execute the strategy for clients. The distributor also uses capital-protected model portfolio services (MPS) for management.
From left to right: Diego Parrilla, Quadriga Funds; Bevan Goulden, IDAD; Steve Lamarque, Hilbert Investment Solutions; Varya Nuttall, Barclays Private Bank; Tim Mortimer, FVC (moderator).
Steve Lamarque, CEO and founding partner at the UK-based structured products investment firm Hilbert Investment Solutions, also highlighted the use of MPS to achieve absolute returns for clients, as well as exchange-traded funds (ETFs).
Eighty percent of the firm’s volumes are sold to retail investors and the remaining volumes to pension and insurance companies, Lamarque said.
“I would argue that portfolio is a team,” said Diego Parrilla, chief investment officer at Quadriga Funds, a Madrid-based asset manager. “You're the coach, and ultimately you need strikers, midfielders, defenders, and goalkeepers – equities, generally viewed as the striker; credit perhaps [as] midfielders; fixed income [as] conventional defenders and volatility as the risk as goalkeepers.”
“As a corollary of this, those people who suffer from the risk of false diversification, which is confusing a portfolio that has many things with a portfolio that diversifies,” he said. “I think understanding correlation... is critical that leads to the active nature of protection.”
From left to right: Bevan Goulden, IDAD; Diego Parrilla, Quadriga Funds; Steve Lamarque, Hilbert Investment Solutions; Varya Nuttall, Barclays Private Bank; Tim Mortimer, FVC (moderator).
Parrilla noted that the concept of rebalancing alpha is about “a game of accumulation and monetisation” in the context of the dynamic interplay between capital preservation and capital appreciation.
“You should be accumulating protection during benign times, and you should be monetising it during crisis [times],” he said. “A lot of people do exactly the opposite – they panic, buy into the crisis. They fatigue, sell as things recover.”
He pointed out a common mistake where managers finance the protection of the portfolio. “If you want to finance a million euros premium, you go to the bank and you borrow a million euros and return the one to three by selling the call option, and the market rallies 30% in your face. Financing a million euros in premium costs you 25 million… I think what is critical here is ‘how do we find ways in which we maintain that upside, increase the downside?’”
The Spanish asset manager sets a self-imposed risk limit for long only options, while it can buy US equity puts to protect its US equity exposures in certain market conditions, he added.
From left to right: Diego Parrilla, Quadriga Funds; Bevan Goulden, IDAD; Steve Lamarque, Hilbert Investment Solutions; Varya Nuttall, Barclays Private Bank; Tim Mortimer, FVC (moderator).
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