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The volume of trading in all structured products on the WSE was over 140 thousand in November. The value of trading was PLN 9 million in November, three times higher than in October. Structured products are increasingly popular with investors. Products of three issuers: Deutsche Bank London, Erste Bank, and Raiffeisen Centrobank, are currently traded on the WSE. New instruments of other issuers will be introduced to trading on the WSE in early 2008.
Structured products are financial instruments whose price depends on a specific market parameter (e.g., price of shares or baskets of shares, stock exchange indices, commodity prices, fx rates). Investment in a single type of securities enables easy participation in changes of foreign indices, baskets of shares and prices of commodities such as gold and oil.
Table 1. Volume and Value of Trading in Structured Products, October-November 2007
| Month |
Volume of trading
(# instruments) |
Value of trading
(PLN) |
| October |
13 722 |
2 261 627 |
| November |
140
271 |
9
022 967 |
| Source: WSE | ||
As structured products offer easy access to a wide range of investment opportunities, they are increasingly attractive to investors. The WSE in co-operation with RCB and Parkiet held a series of free-of-charge investor training sessions “Structured Products: The Future of Investment.” The sessions were held in Warsaw, Kraków, Katowice and Pozna?. The training was very popular and the number of applications significantly exceeded the available number of seats. The sessions have gathered close to 500 participants in all these cities.
Investors are mainly interested in structured certificates issued by Raiffeisen Centrobank (RCB), in particular oil (Brent Crude) and gold commodity certificates. The number of transactions in these instruments rose by a factor of 4, the volume of trading rose by a factor of 14, and the value of trading rose by a factor of 6 month on month in November 2007.
Table 2. Selected RCB Products – Volume and Value of Trading, October-November 2007
| Product |
Month |
|||
| October |
November |
|||
| Volume of trading (# instruments) | Value of trading
(PLN) |
Volume of trading (# instruments) | Value of trading
(PLN) |
|
| Brent Crude |
6
595 |
156
730 |
127 908 | 4
262 000 |
| Gold |
3 348 | 1 332 960 | 11
162 |
4 545 000 |
| RDX |
107 |
17 000 | 40 |
6
000 |
| 127 | 10 000 | 150 |
10
000 |
|
| Source: WSE | ||||
Structured Products In WSE Trading:
1. db Magiczna Trójka
The db Magiczna Trójka Structured Bonds issued by Deutsche Bank London are traded on the WSE as of 25 August 2006. It is the first structured product to be traded on the WSE parallel market in the single-price auction system with a double fixing. The product is traded on the same terms as zero-coupon bonds. A second series of the db Magiczna Trójka Structured Bonds are in trading on the WSE as of 20 August 2007.
2. db Obligacja WIG20
db Obligacja WIG20 are a second category of structured bonds issued by DB London and traded on the WSE. The three-year structured bonds linked to the WIG20 index are traded on the WSE parallel market in the single-price auction system with a double fixing. The product is traded on the same terms as zero-coupon bonds.
3. Erste NTX Certificates
The NTX index certificates issued by ERSTE Bank are the first instrument of this category on the WSE. Index certificates are the simplest financial instrument used to invest in a portfolio of shares covered by an index. The NTX index covers the top 30 companies in Austria, Poland, the Czech Republic, Slovakia, Hungary, Slovenia, Romania, Bulgaria and Croatia as measured by capitalisation and free float.
4. RCB Certificates
The structured certificates of Raiffeisen Centrobank AG (RCB), Vienna, are traded on the WSE as of 13 September 2007. The first RCB instruments traded on the WSE are 8 series of open-end investment certificates, including:- CECE
The certificate tracks the performance of the CECE index of the Vienna Stock Exchange comprising shares from the Czech, Hungarian and Polish market. - CECExt
The certificate tracks the performance of the CECExt index of the Vienna Stock Exchange comprising shares of the CECE®EUR index and SETX - South-East Europe Traded Index (Slovenia, Croatia, Bulgaria, Romania). - RDX EUR
The certificate tracks the performance of the RDX index of the Vienna Stock Exchange comprising ADRs and GDRs of the top 10 Russian companies listed on the Frankfurt Stock Exchange. - DAX
The certificate tracks the performance of the German DAX index comprising shares of the top 30 German companies. - DJ EuroStoxx 50
The certificate tracks the performance of the DJ EuroStoxx 50 index. - Brent Crude Oil
The certificate tracks the performance of the prices of the series of Brent Crude Oil futures contracts with the nearest expiry date traded on the Intercontinental Exchange, London. - Gold
The certificate tracks the performance of the price of one ounce of gold. - Eastbasket Ukraine Kazakhstan
The certificate tracks the performance of the price of the Eastbasket Ukraine & Kazakhstan comprising selected shares from the Ukraine and Kazakhstan market.
