US Wrap: External credit and growth products dominate

The resurgence of bullish growth products is continuing in the US market, alongside the use of external credit providers to issue notes. Eksportfinans appears to be dominating the majority of this business, with two providers looking to the company to supply credit for their products: Merrill Lynch and Wachovia.

Growth structures represented 10 of the new issues, all linked to either the S&P 500 or providing exposure to international equity. One of the most bullish, on offer from Merrill Lynch, allows investors to participate 300% in upward moves of the S&P 500 index over 14 months, subject to a cap of 27.69% on returns. Capital is not protected on the downside.

Reverse convertibles are beginning to make more consistent appearances, and the close of last week was no exception, when six of the structures