Innovative investments with modern structures
The demands made on investment products by the private and institutional investor have changed in recent years. Today’s modern product structures allow access to many new markets and strategies. Certificates are just one example of a newly emerged structure in this field. In Germany, the market for certificates has already crossed the 100 billion EUR threshold. Exchange-traded funds have also captured a large share of the global investment market in just a few years. These developments are paired with strong growth in the indexing business since indices not only follow the trend towards passive investment concepts for base investments, but are also popular in complex strategies due to their neutrality and regulation. This turn of events is hardly surprising: Innovative investment products give investors the ability to implement almost any conceivable investment strategy – taking into account their particular appetite for risk and their market expectations – using just one product.
Changes are not only in evidence in the area of product structures, but also where asset classes are concerned. Whereas stocks and bonds used to be sufficient for most investors, additional investment objects have recently become popular, with commodities, timber and other alternative assets finding their way into many portfolios. One of the driving forces behind this reaching out to innovative asset classes is the increased correlation of the traditional asset classes. The crucial point here, however, is the selection of the best product wrapper. Depending on individual requirements, a UCITS fund, a certificate, an offshore vehicle or some alternative structure may be the most suitable. Specific expertise is also required in the later stages of the structuring process in order ensure the best possible setup is put into place.
These developments pose challenges for banks, wealth managers and other financial institutions, but they also create the opportunity to stand out from the competition. Thus, modern investment products open the gates to new, sustainable sources of revenue.
Changes are not only in evidence in the area of product structures, but also where asset classes are concerned. Whereas stocks and bonds used to be sufficient for most investors, additional investment objects have recently become popular, with commodities, timber and other alternative assets finding their way into many portfolios. One of the driving forces behind this reaching out to innovative asset classes is the increased correlation of the traditional asset classes. The crucial point here, however, is the selection of the best product wrapper. Depending on individual requirements, a UCITS fund, a certificate, an offshore vehicle or some alternative structure may be the most suitable. Specific expertise is also required in the later stages of the structuring process in order ensure the best possible setup is put into place.
These developments pose challenges for banks, wealth managers and other financial institutions, but they also create the opportunity to stand out from the competition. Thus, modern investment products open the gates to new, sustainable sources of revenue.