Leonteq and Basler Kantonalbank have agreed to work together on structured investment products from the end of April 2020.

Basler Kantonalbank has joined Leonteq’s multi-issuer platform ‘after intensive development and implementation work,’ and its products are available for distribution in Switzerland. As part of this cooperation, BKB will act as the issuer of structured investment products, while Leonteq will provide services along the value chain.

The new product offering by Basler Kantonalbank consists of a range of payoffs and underlyings and will also be available for Leonteq’s clients on LynQs, the firm’s one-stop-shop for structured products. In addition, Basler Kantonalbank will offer its products to its own clients in Switzerland.

Partnerships like the one with BKB are core to the firm’s strategy - Alessandro Ricci, Leonteq

BKB Group is one of the largest banks in Switzerland, with total assets of CHF54.4 billion and a total capital ratio of 17% as of end 2020. Basler Kantonalbank has an AA+ issuer rating from Standard & Poor's and a state guarantee from the Canton of Basel-Stadt.

Alessandro Ricci (pictured), head investment solutions and member of the executive committee of Leonteq, said the partnership with BKB on an operational level ‘further strengthens our offering with its reputation and credit rating’.

‘Partnerships like the one with BKB are core to the firm’s strategy to be the leading marketplace for structured products,’ said Ricci.

Barclays rolls out suite of FX products to Barx e-trading platform

Barclays has launched a suite of new products for enhancing its electronic trading platform, Barx, in to further enhance its electronic capabilities and strengthen its FX offerings for clients.

Corporate and institutional clients will be able to access the Barx Book for FX, Barclays’ principal liquidity solution that forms part of Barx Gator, the platform’s execution tool. The new solution gives clients access to principal liquidity streams, as well as an increased number of external liquidity providers.

In addition, clients can now access Gator Adapt, a new implementation shortfall algorithm available within the Barx Gator suite of algorithms. This new algorithm allows clients to manage the trade-off between arrival price slippage and execution price risk and clients have the flexibility to choose an execution style which is intended to minimize market impact for a given level of risk.

In addition, Naseer Al-Khudairi, global head of markets electronic trading and digital strategy at Barclays said the UK bank has also launched Barx Direct, the platform’s improved low latency solution which uses innovative pricing models, predictive analytics, and an optimised co-location strategy.

HSI expands offering, debuts new ESG indices

Hang Seng Indexes Company has launched the Hang Seng Shanghai-Shenzhen-Hong Kong Clean Energy Index and Hang Seng Shanghai-Shenzhen-Hong Kong Autonomous and Electric Vehicles Index, to capture the growing interest among investors in renewable energy and electric vehicles.

The Hang Seng Shanghai-Shenzhen-Hong Kong Clean Energy Index tracks the overall performance of the 30 largest Hong Kong and mainland China companies that are engaged in hydropower, biomass energy, solar energy, wind energy and geothermal energy generation and are eligible for trading through the Stock Connect Scheme.

This new index recognises that clean energy is becoming a hot new investment theme on the back of increasing global concern with environmental protection issues, as well as greater focus on investing that includes consideration of ESG issues.

The Hang Seng Shanghai-Shenzhen-Hong Kong Autonomous and Electric Vehicles Index will track the overall performance of the 30 largest mainland and Hong Kong companies involved in the value chain of the electric car and autonomous driving segment.

The Honk Kong SAR-based index provider has also launched the Hang Seng Stock Connect Hong Kong Top Shareholding 50 Index and Hang Seng Stock Connect China A Top Shareholding 50 Index.  

The Hang Seng Stock Connect Hong Kong Top Shareholding 50 Index tracks the performance of the 50 most popular Hong Kong listed companies among Mainland investors, commonly known as the Southbound investors, in terms of their shareholdings by market value.

The Hang Seng Stock Connect China A Top Shareholding 50 Index tracks the performance of the 50 most popular mainland listed companies among Hong Kong investors in terms of shareholdings by market value.

Constituents of both indexes must be eligible for trading under the Stock Connect schemes.

Asic’s CfD product intervention order takes effect

The Australian Securities and Investments Commission’s (Asic) product intervention order imposing conditions on the issue and distribution of contracts for difference (CfDs) to retail clients has entered into effect.

The order is aimed at strengthening protections for retail clients trading CfDs after the regulator found that CfDs have resulted in, and are likely to result in, significant detriment to retail clients.

Asic’s order reduces CfD leverage available to retail clients and targets CfD product features and sales practices that amplify retail clients’ CfD losses, such as providing inducements to become a client or to trade. It also brings Australian practice into line with protections in force in comparable markets elsewhere.

The maximum CfD leverage available to retail clients will range from 30:1 to a 2:1, depending on the underlying asset class. Before now, a retail investor’s CfD exposure could be as much as 500 times their original outlay.

The maximum penalty for a contravention of a product intervention order is five years’ imprisonment for individuals and substantial pecuniary penalties of up to $555 million for corporations.

The product intervention order will remain in force for 18 months, after which it may be extended or made permanent.

Eurex expands equity index segment with new factor futures

Eurex has expanded its equity index segment with new factor futures. The products will be launched on 26 April as a response to ‘growing investor demand for factor-based instruments’.

The new offering is based on Qontigo’s Stoxx Industry Neutral Ax Factor Indices suite and comprises futures based on the five standard factors: value, momentum, low risk, quality and size.

An additional multi-factor future, which combines the five exposures in one product, is also included. The futures cover factors in both European and US markets, represented by the Stoxx Europe 600 and the Stoxx USA 500 universes. All factors are built using the Axioma factor risk model.

Eurex and Qontigo, both part of Deutsche Börse Group, joined forces to offer factor investors an easy, transparent, and cost-efficient alternative to trading the underlying equities or using OTC instruments.

Stephan Flaegel, global head of indices and benchmarks, Qontigo, said the new suite ‘relies on commercially accepted and academically tested factor definitions and transparent index construction rules’.

‘It sets a new, high-quality industry standard in this growing market segment,’ he said.