Differences between German and Swiss markets cited as Six focuses on Switzerland The Six Swiss Exchange has terminated its partnership with Deutsche Börse to jointly run the Scoach structured products trading platform because of differences between the German and Swiss markets, according to industry sources. Six and Deutsche Börse began operating the Scoach platform as a joint venture in 2007, but Six has now decided to end Deutsche Börse's involvement and focus on the Swiss market. The German exchange will cease to provide a trading link to the platform on June 30. After more than five years, the partnership was no longer workable because the Swiss and German sales models and investor bases are so different, says Daniel Sandmeier, president of the Swiss Structured Products Association. "The Swiss and German markets for structured products have evolved differently and each has specific needs and market structures," says Sandmeier. "These differences have become more distinct over the past year." The trading model for structured products is completely different in the two countries, with sales in Germany more likely to be done personally through so-called 'specialists' or financial advisers, while in Switzerland electronic trading platforms dominate, says Sandmeier. In addition, the investor base for structured products is completely different in Germany, he says. While there are only 45,000 listed products in Switzerland compared to around one million in Germany, turnover for Swiss structured products is roughly €10 billion ($13.3 billion) more than in Germany, at €26 billion. Switzerland also has a much higher proportion of institutional investors than Germany, where significantly more retail investors buy structured products. "[Six] has decided to focus on the specific needs of the Swiss market to foster the market's growth and success," adds Sandmeier. Deutsche Börse declined to comment....
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