Nordea has entered the Norwegian exchange-traded products (ETPs) market with a new range of bull and bear products listed on the Oslo Exchange (Oslo Børs) offering retail investors exposure to a selection of equity indices.

The new Nordea range is comprised of 14 short and leverage products linked to the OBX Index, which lists the 25 most liquid companies on the main index of Oslo Børs (OSE) and other foreign indices including the S&P 500, Dax and Eurostoxx 50 indices.

Bull and bear ETNs have been available for many years on Oslo Børs but limited to Norwegian equities, commodities and OBX as underlying, said Frode Hagen, chief analyst, asset sales and investment products at Nordea Markets.

“By offering International indices like Dax, Eurostoxx 50 and S&P 500 we have something new to offer Norwegian clients,” said Hagen. “We already have a number of ETNs in Sweden and Denmark, so entering the Norwegian market is just a natural step for Nordea. This is our first ETN launch on OSE, but certainly not the last.”

Nordea’s products, said Hagen, will also have a differentiating factor on the 5x multiplying factor on the upside/downside performance of the underlyings as the maximum leverage offered on OSE up until now was 4x, and are best suited to experienced investors who have a clear view on where they expect the market to go, particularly over the short term.

The newly listed securities are wrapped as exchange-traded notes and offer a gearing of between 2 and 5 times the return in the underlying market each day available

“Bull and bear products enable investors to position themselves for the market to either rise or fall,” said the bank in a statement. “The level of risk associated with such investments is high.”

Nordea joins ETP providers Handelsbanken and DNB, which already offer a range of ETNs linked to several asset classes including commodities, individual shares and the OBX index in both bull and bear formats and with gearing of up to five times the daily return of the underlying.

Nordea Markets will act as the market-maker for all the securities listed and will provide daily liquidity during Oslo Børs’s trading hours in normal market conditions.

Nordea is one of the leading providers of structured products in the Norwegian retail market. In 2014, the bank had a 77% market share after selling more than NOK500 (€53.9m). Year to date, Nordea has marketed 16 structured products in Norway worth NOK264m, which represents a 28% market share.

Photo: Terje Pedersen / NTB scanpix

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