US Wrap: Accelerated growth products dominate, and choose tech

The range of new accelerated growth products launched yesterday included exposure to emerging markets, international equity and technology stocks alongside the usual US equity plays. Bank of America (BoA) launched a growth structure linked to the performance of the Technology Spdr fund, which selects tech-related stocks from the S&P 500. The deal lasts a year and a quarter and offers 300% participation in the fund up to a cap of between 18-22%, with the exact level to be set at the pricing date. Investors will not have any downside protection.

Overall, product scope broadened considerably. BofA also launched a kickout product linked to the iShares MSCI Brazil Index Fund which promises to pay a coupon of 15-19% after one year, while including 10% downside protection.

Principal protected products are also beginning to make more regular appearances as volatility eases off, making options slightly cheaper and giving room to add guarantees. BoA and JP Morgan launched principal protected notes linked to the S&P 500 index, both 100% capital guaranteed. A single reverse convertible was on offer, from Morgan Stanley, and packaged using the external credit of Eksportfinans. Contrary to the usual US stock linked notes, it is linked to the performance of the iShares MSCI Emerging Markets Index Fund.

 

Issuer

Product type

Underlying

Pricing date

Maturity date

Eksportfinans

Reverse Convertible

iShares MSCI Emerging Markets Index Fund

Jul 10 2009

Jan 15 2010

Morgan Stanley

Accelerated Growth

S&P 500

Jul-09

Jul 27 2011

Morgan Stanley

Straddle

S&P 500

Jul-09

Jul 27 2011

Morgan Stanley

Accelerated Growth

iShares MSCI Emerging Markets Index Fund

Jul-09

Aug 27 2010

Morgan Stanley

Accelerated Growth

iShares MSCI EAFE Index Fund

Jul-09

Jul 27 2011

J P Morgan Chase

Principal Protected

S&P 500

Jul-09

Jul 31 2014

Barclays Bank

Accelerated Growth

S&P 500

Jul-09

Aug 27 2010

Bank of America

Accelerated Growth

MSCI Emerging markets index

Jul-09

Jul-11

Bank of America

Review

S&P 500

Jul-09

Aug-11

Bank of America

Review

iShares MSCI Brazil Index Fund

Jul-09

Aug-11

Bank of America

Accelerated Growth

S&P 500

Jul-09

Jul-12

Bank of America

Accelerated Growth

Technology SPDR

Jul-09

Oct-10

Bank of America

Principal Protected

S&P 500

Jul-09

Jul-13

Source: Future Value Consultants & SEC filings

For access to analysis of the US structured product market, visit www.structurededge.com

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