Tue, Jun 30, 2015
A A A
Welcome Guest
Free Trial RSS
Get FREE trial access to our award winning publications
Industry Updates

ESMA publishes research on the sale of complex products to retail financial consumers

Wednesday, July 03, 2013
Opalesque Industry Update - The European Securities and Markets Authority (ESMA) has published a research report on Retailisation in the EU, which examines the growth in the sale of complex financial products to retail financial consumers in the European Union (EU).

ESMA’s research focused on two specific types of complex products, alternative UCITS – where assets under management grew from €20bn to €85bn between 2007 and 2012 - and structured retail products – whose outstanding amounts totalled €770bn at the end of 2012. The research found that while their sale to retail financial consumers has increased, there is evidence to show that both products have produced relatively low returns.

The Report, comparing 600 alternative UCITS funds and 2750 structured products with capital protection sold across the EU to consumers between 2007 and 2012, found evidence that average returns for both products were relatively low at 3% for alternative UCITS and 2.5% for structured products.

Additionally, an analysis in the report of a sample of 76 structured products sold to retail investors found that structured products are sold, on average, with a significant issuance premium, estimated at around 4.6% of the issue price and up to 5.5% when the credit risk of the issuer is included.

ESMA Policy Responses
ESMA will use the reports’ findings in its policy work on improving investor protection by promoting better information disclosure at the point of sale about the total costs of investing in complex products and specific risks attached to each product.

press release
PD

What do you think?

   Use "anonymous" as my name    |   Alert me via email on new comments   |   
Today's Exclusives Today's Other Voices More Exclusives
Previous Opalesque Exclusives                                  
More Other Voices
Previous Other Voices                                               
Access Alternative Market Briefing


  • Top Forwarded
  • Top Tracked
  • Top Searched
  1. Opalesque Exclusive: New systematic strategy managed alongside research firm outperforms S&P500[more]

    Benedicte Gravrand, Opalesque Geneva for New Managers: An emerging CTA manager explains how he runs his strategy, which is based on an index produced by a research firm. Peter Turk is head of

  2. Larry Robbins' hedge fund Glenview buys 1m Tenet Healthcare shares[more]

    Komfie Manalo, Opalesque Asia: Glenview Capital Management said it bought an additional 979,482 shares at Tenet Healthcare Corp valued at $53.80 million, raising its stakes in the healthcare services company to 15.16%, reported

  3. Hedge funds panic over Greece[more]

    Komfie Manalo, Opalesque Asia: Some investors are in panic mode as Greek Prime Minister Alexis Tsipras announced Sunday night that the banks and the stock market would be closed Monday, said

  4. Alternative investment industry could grow to $13.6tln in five years[more]

    Komfie Manalo, Opalesque Asia: Leading auditing and advisory group PwC said that the global alternative investment industry, which includes hedge funds, private equity and real assets, is set to increase to $13.6tln within the next five years. "Be

  5. Qbasis gets $200m-plus investment in 'black swan' hedge fund[more]

    From Reuters.com: A hedge fund that more than doubled clients' money during the 2008 financial crisis has attracted more than $200 million from an investor aiming to cash in on fresh ructions in global markets. Qbasis Invest has secured the investment from Britain's Omada Capital, Florian Wagner, wh

 

banner