Long participation certificates, a new category of trackers, have been added to GPW’s offer of structured products. Long participation certificates are used in investment strategies in expectation of an uptrend, ie, they increase in value as the price of the underlying goes up. The underlying of the participation certificates are Brent Crude Oil futures. The participation certificates issued by Raiffeisen Centrobank have a fixed maturity and expire two weeks before the expiration of the underlying futures.
“Considering the recent increase in the number of investment accounts and historically low interest rates, we expect that interest in structured products will be growing even faster. However, before opting for such investment products, it is necessary for investors to understand their mechanism. This is why GPW is actively educating the market in structured products by developing educational materials and offering conferences, training sessions, and webinars. The first webinar dedicated to investing in oil structured products took place in April 2020. We are planning to provide more webinars and educational initiatives in the near future,” says Izabela Olszewska, Member of GPW’s Management Board.
Different to existing certificates available on GPW, where series of futures are rolled over before they expire, the underlying of the new participation certificates are subsequent series of futures listed on the Intercontinental Exchange (ICE). Because a specific futures series is used as the underlying, the change in the price of the structured certificates is more accurate in relation to the underlying. Participation certificates have no embedded leverage.
“We hope that the new structure of the participation certificates based on the price of Brent Crude Oil Futures, without rolling futures over, will be welcomed by investors. We are planning to launch more products in the coming weeks and months. I encourage everyone to regularly visit our website and take part in educational campaigns which we run together with GPW,” says Mariusz Adamiak, Regional Manager at RCB.
Structured products are used to invest indirectly in selected underlying assets such as exchange indices, stocks, commodities, FX rates, interest rates, agricultural products, as well as baskets of stocks (of different companies), commodities or indices. GPW currently lists over 1.5 thousand structured products which provide exposure among others to seven different FX rates, 10Y German Treasury bonds, 30Y US Treasury bonds, stocks of many companies (Polish and international) and stock indices, as well as different types of commodities. Importantly, structured products allow investors to select investment products depending on the preferred level of investment risk, and to make gains both on the upside and the downside of the underlying.