Last week, the structured products industry celebrated itself. The 15th International Structured Products Forum (ISPF) took place in picturesque Lucerne, including an excurstion to the Bürgenstock.

This location carries iconic significance for the derivatives industry, though somewhat more for the international futures and options exchanges than for today’s Swiss «struki ecosystem». It was here that their annual gatherings were once held. The landmark 1997 merger of the Swiss Options and Financial Futures Exchange (Soffex) with the Deutsche Terminbörse (DTB) was also announced during one of these conferences.

A Descendant of the Legendary Bürgenstock Conference

The ISPF can be considered a legitimate descendant of those legendary meetings. The Swiss Futures & Options Association (SFOA), which organized the Bürgenstock conferences, held its very first ISPF event in 2009 as part of its conference (by then already relocated to Interlaken). To this day, the «international» element remains central - as the name demands.

This year’s ISPF also brought noteworthy news – if not on the scale of a cross-border exchange merger. The Swiss Structured Products Association (SSPA), together with market infrastructure and exchange operator SIX Group, launched a reference index for structured products in the popular category of Barrier Reverse Convertibles (finews.ch reported).

A Distinct Asset Class?

One of the declared goals pursued by the industry association with the new benchmark is to raise awareness and recognition of structured products as an asset class, and to increase their share in client portfolios - both for institutional investors (asset management) and private investors.

For years, the share of structured products in the total securities holdings of domestic and foreign depositors (according to Swiss National Bank statistics) has hovered around 3 percent. By mid-2025, out of a total of around 8 trillion Swiss francs, about 250 billion francs were allocated to structured products. This can certainly be interpreted positively: the instruments have firmly established themselves in Switzerland's investment universe and found their market.

Persistent Stagnation in Portfolios

However, the fact that the share is not growing is somewhat frustrating for the industry, particularly since market participants are convinced their products generate considerable added value for investors - a value not easily replicated by other asset classes. A certain impatience was clearly felt in the forum debates.

The issue has occupied Doyens such as SSPA President Georg von Wattenwyl (Bank Vontobel) and SSPA board member Willi Bucher (Raiffeisen) for many years. The association has repeatedly launched initiatives aimed at increasing distribution and market penetration.

Lucerne confirmed the insight that there is no magic formula to make structured products more appealing to investors. Nor are miracles to be expected from the newly launched benchmark, the SSPA MBRC Global Index - though it does promise to be valuable and useful. Market participants agreed that the entire ecosystem (investors, asset managers, banks, distributors) must be addressed - especially client advisors, for whom structured products still often remain unfamiliar territory.

Gen Z Prefers Cryptocurrencies

Complicating matters is the rise of cryptocurrencies in recent years, a powerful new competitor that is particularly attractive to Generation Z. A study commissioned by the SSPA (not published) shows that for this demographic, 24/7 availability, flexibility, and simplicity are decisive factors.

In this respect, the largely unregulated crypto assets are clearly ahead of structured products, even if one can debate whether a Bitcoin is truly easier to understand than a barrier product based on Nestlé, Novartis, or ABB shares.

Diversification Versus Volatility

O course, the boom in Bitcoin and other cryptocurrencies also creates opportunities, as they can serve as underlying assets for structured products. But in this area, another major competitor is clearly leading: the ETF/ETP industry, which has grown enviably strong in recent years.

Cryptocurrencies are often promoted with the argument that they have little correlation with traditional asset classes and thus lend themselves to portfolio diversification (even if the evidence for this is less clear-cut than the theory suggests.)  Structured products, on the other hand, make the (implied) volatility – the expected price fluctuations – of traditional markets tradable in simple ways and in various forms.

Will Market Developments Play Into the Industry's Hands?

It was another industry veteran, Luigi Vignola (Bank Julius Bär), who in Lucerne reminded participants of this characteristic - and of the origins of the industry some 30 years ago, when several Swiss banks active in the warrant (options certificate) business began issuing structured products, partly to balance their volatility positions.

Signs are increasing that financial markets may be heading for more turbulent times, with rising volatility. Should this scenario materialize, the industry could finally reap the rewards in the very field it has carefully cultivated over the past years.