With the introduction of Version 6.1 of the Swiss Market Feed (SMF), transparency in the area of structured products has been massively increased.
The new data fields meet a tremendous need amongst market participants, given the fact that today more than half of the participation products have more than one underlying instrument. Now, details are provided on the components of multi-asset products, i.e. the corresponding strike price, barrier and/or cap are indicated for each underlying instrument.
Monitoring of barrier violation
The key figures associated with barrier violation are of great significance. With SMF 6.1, the span between the price of the individual products and that of the barrier are published. The readings are expressed both as a percentage and in absolute numbers, which in turn enables the investor to assess the degree of threat that a barrier could be touched. Barrier violation is automatically monitored for each underlying instrument and registered as status information at the underlying instrument level as well as on the whole for a given product. This monitoring of barriers is a milestone in terms of heightening the understandability of structured products. It increases transparency and offers a better means of comparing various products.
Breakdown of coupon components
SMF 6.1 affords enhanced data depth by providing additional information on the relevant coupons. With structured products, the value of the nominal coupon is broken down into a premium component and an interest component. This information is of great significance for the tax treatment of the structured product.
This broadening of the range of information is being accomplished within the framework of a strategic partnership between EXFEED and Derivative Partners Research AG, the goal of which is to provide market participants with high-quality, practice-relevant data on structured products. Further updates, such as the "Stern attribute" launched by the Swiss Structured Products Association (SSPA), are in the planning stage. This supplemental information serves as a means of describing more precisely those product varieties that vary slightly from the basic type. According to Roger Studer, President of the SSPA, the Association very much welcomes the introduction of the new data fields and supports all efforts aimed at enhancing transparency.
Via data vendors, EXFEED will offer this broadened array of core data and realtime key figures on structured products as of the 1.7.2008 introduction of its new price list.