{"date":"2023-02-28T00:00","headerImageUrl":"https://structuredproducts-ch-pub-uat.leonteq.com/product-news/product-homepage-banner/leonteq-know-how-product+homepage+banner.jpg","subTitle":"Structured Products: Variety is the future","windowTitle":"Leonteq Know-how","category":"know-how","title":"Leonteq Know-how 1","body":"<p>Structured products are true all-rounders. On the one hand, they pave the way to asset classes that would otherwise be inaccessible or very difficult to access for private investors. On the other hand, the investment form also enables earnings opportunities in all conceivable price directions. Whether prices are rising, falling or trending sideways, there is a suitable product for every assumption. Structured products therefore allow the \"Siamese twins\" of investment, opportunity and risk, to be individually matched.<\/p>\n<h3>A look behind the scenes<\/h3>\n<p>With our new knowledge newsletter \"Leonteq Know-how\", we would like to open the door to the world of structured products for you. We outline in a comprehensible way how the different product types work and highlight their advantages. But the risks are not concealed either.<\/p>\n<p>Since the times in which the capital markets know only one direction are rather the exception, it always comes down to the best suitable solution. With structured products, investors are always in the best position, because flexibility is a central feature of these securities. The Swiss Structured Products Association (SSPA) classifies structured products into two main categories: Investment Products and Leverage Products. The investment products are in turn subdivided into the three categories \"capital protection\", \"yield enhancement\" and \"participation\". In the first issues of the new knowledge newsletter, we focus on yield enhancement. Among the instruments in this class, SSPA includes discount certificates and the various forms of reverse convertibles.<\/p>\n<h3>Sideways to success<\/h3>\n<p>The breadth of their possible applications makes yield enhancement products an almost indispensable component of asset management. However, anyone wishing to act here should first familiarize themselves with important features and terms (see glossary). We will continuously expand the product-related glossary in the coming issues.<\/p>\n<p>Basically, yield enhancement products have a predefined maximum return. In addition, partial protection also plays an essential role. The structure shows its full superiority when the underlying asset moves only marginally during the term. Then a higher return can be achieved than with a direct investment. While in the case of the discount certificate the discount granted on the price of the underlying asset can provide the profit, in the case of the reverse convertibles it is the coupon, which is usually guaranteed in advance. In the next issue of \"Leonteq Know-how\", we will present you in detail with the different types of reverse convertibles up to the multi-barrier reverse convertible and also test them for their practicality.<\/p>\n<h3>Important terms<\/h3>\n<div><ltq-table id=\"important terms\" title=\"\"> <template v-slot:default=\"\">\n<tr>\n<td>Strike price<\/td>\n<td>The strike price is the price at which an investor can buy or sell the underlying security.<\/td>\n<\/tr>\n<tr>\n<td>Barrier<\/td>\n<td>The barrier is a predefined price level that may not be touched or breached. If this barrier is breached, this has consequences for the payout profile. Two types of exercise styles can be distinguished: In the \"American\" variant, the barrier is active over the entire term; in the \"European\" variant, it is only active at the final fixing.<\/td>\n<\/tr>\n<tr>\n<td>Underlying<\/td>\n<td>The underlying is the underlying asset, e.g. shares, indices or commodities, to which the investment product relates. Its price performance is the most important factor influencing the performance of the structured product.<\/td>\n<\/tr>\n<tr>\n<td>Conversion ratio<\/td>\n<td>The conversion ratio indicates the number of units of the underlying asset to which a financial instrument relates.<\/td>\n<\/tr>\n<tr>\n<td>Coupon<\/td>\n<td>The coupon is the predefined nominal interest rate of a bond. Reverse convertibles, which have a limited term, pay out regular, fixed payments. The coupon payment can be guaranteed or conditional. In the latter case, the payment depends on a predefined condition (e.g. the underlying must be quoted at a certain price level on the observation date).<\/td>\n<\/tr>\n<tr>\n<td>Issuer<\/td>\n<td>The issuer is an institution that issues the structured product. Since structured products are debt instruments, the issuer risk is important: this is the risk that the issuer will not be able to meet its financial obligations. The issuer's rating, i.e. its creditworthiness, provides an indication of its solvency. Leonteq Securities AG has a solid BBB- rating (as of 10.02.2023).<\/td>\n<\/tr>\n<tr>\n<td>Maturity<\/td>\n<td>Term refers to the period of time between the issuance of the structured product and its maturity date.<\/td>\n<\/tr>\n<tr>\n<td>Repayment<\/td>\n<td>Repayment takes place at the end of the term on a predefined date. However, early redemption may also occur in certain cases. If an autocall function is included in the structure, the product will automatically mature upon the fulfillment of a certain event. With the softcall variant, the issuer has the right, but not the obligation, to decide from a certain point in time whether the product will expire early. In both cases, the term of the product may be significantly shortened.<\/td>\n<\/tr>\n<tr>\n<td>Currency<\/td>\n<td>If the product currency and the investor's domestic currency differ, this may have a positive as well as a negative impact on the return due to the exchange rate. Exchange rate is the exchange ratio of two currencies.<\/td>\n<\/tr>\n<\/tbody>\n<\/template>\n<\/ltq-table>\n<\/div>\n<div><ltq-button color=\"primary\" url=\"https://structuredproducts-ch.leonteq.com/news/know-how/know-how-reverse-convertibles?language_id=1\" label=\"Leonteq Know-how 2\"><\/ltq-button><\/div>\n<div>      <p>We look forward to answering all of your questions about our products and how they are traded. Please don't hesitate to get in touch! Phone: <a href=\"tel:+41588001111\">058 800 11 11<\/a>, email <a href=\"mailto:info@leonteq.com\">info@leonteq.com<\/a> or <a href=\"/contact\" title=\"Contact\">contact us here<\/a>.\n<\/p>\n  <\/div>","url":"know-how-basics","investmentThemeVerticalImageUrl":"https://structuredproducts-ch-pub-uat.leonteq.com/product-news/sidenav-banner/leonteq-know-how-sidenav+banner.jpg","thumbnailUrl":"https://structuredproducts-ch-pub-uat.leonteq.com/product-news/thumbnail/leonteq-know-how-thumbnail.jpg"}