Vontobel has launched two participation certificates linked to the US presidential candidates Donald Trump and Hillary Clinton. The two options available to investors, a Voncert Trump Basket and a Voncert Clinton Basket, can be subscribed to until November 8, 2016, the day of the US elections. However, only the certificate linked to the winner will be issued.
Since the subscription period opened on October 4, 2016, the response of investors to the two trackers, which are public offers in Austria, Germany, Luxembourg, Liechtenstein and Switzerland, has been remarkable, according to Heiko Geiger (pictured), head of public distribution, Germany and Austria at Vontobel Europe. "Demand was significant, even though it is a short term investment idea for a traditional investment product," he said.
"The investment idea was generated in our research department," said Geiger. "We have issued other event driven baskets in the past such as certificates linked to elections, the Olympic Games or football championships."
The certificates are denominated in euro (Swiss investors can choose between US dollars and Swiss francs) and, according to Geiger, are aimed at retail and self-directed investors as well as private banks and financial advisers.
The certificate on the Trump basket tracks 17 weighted shares including JP Morgan Chase, Citigroup, US Bancorp, AutoZone, Boeing, Exelon, on the assumption that if Trump will be elected, big systemic banks and domestic industrial enterprises would profit. The Clinton basket meanwhile comprises 16 weighted stocks, including Medtronic, Ralph Lauren, Tenet Healthcare and Teva Pharmaceutical Industries, which are likely to benefit from an election victory of the Democratic presidential candidate.
Both certificates have a term of one-year and the winner will be available on the exchanges of Frankfurt and Stuttgart from November 14, 2016, onwards.
Vontobel is one of the most active providers of structured products in Europe, according to SRP data. This year to date, the Swiss bank has issued 7,558 products with estimated sales of €7,727m, leading to an 11% share of the European market. The majority of Vontobel's products are offered in the bank's domestic market Switzerland in the shape of among other VonTT outperformance certificates, (Multi) Defender Vonti reverse convertibles and (Multi) Bonus Coupon certificates while the bank also has a large presence in Austria and Germany.
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