Section 1.2
From warrants to autocalls
Essential question
Were structured products invented to meet a market need — or to sell complexity?
The Swiss financial centre did not invent structured products by accident. Each major wave of development answers a specific market condition: high rates that make it possible to finance protection, bull markets that make options attractive, low rates that push investors to hunt for yield. Understanding this history means understanding why a particular structure dominates at a given moment.
Before the timeline — your intuition
Which economic condition enabled the first capital-protected products?
Which economic condition do you think was needed for the first capital-protected products to be viable? Think about the components of a product (zero-coupon + option) before reading on.
Timeline · 40 years of structured products in Switzerland
1980s
Warrants and the first structures
Swiss banks issue the first equity warrants. The idea: separating a right over an asset from ownership of that asset. The Swiss financial centre — with its private banking network and tradition of financial engineering — becomes a laboratory for experimentation.
1990s
The boom in capital-protected structures
Bull market + high rates = ideal conditions. Zero-coupons make it possible to finance capital protection while exposing the investor to rising markets. The first Barrier Reverse Convertible appears around 1995.
2000s
Standardization and SIX
SIX Structured Products (formerly Scoach) becomes the reference exchange. The SSPA (Swiss Structured Products Association) is founded. Products become standardized: ISIN codes, normalized term sheets, regulated market-making.
2010s
The autocall era
Autocalls (Phoenix, Athena) establish themselves as the dominant structure. The reason: in a low-rate regime, they offer an attractive conditional coupon. The Swiss market sees several thousand new issues per year.
Today
ESG, crypto, AI
New underlyings (cryptos, AI themes, ESG), new distributors (digital platforms, robo-advisors), regulatory pressure (FinSA, MiFID II). The structure remains the same; the underlyings and distribution channels evolve.
YOUR TURN TO PREDICT
The zero-rate trap
In 2015, the Swiss rate is negative. Can you still build a 100% capital-guaranteed 3-year product that pays the investor anything? Why?
Key message
Each wave of development in structured products answers a specific economic logic. The dominant structure at a given moment is the one that solves the market's problem at that moment — not the most "complex" one.
Switzerland is today one of the most developed markets in the world for structured products, thanks in particular to its private banking tradition and the SIX infrastructure. The main issuers are UBS, Julius Bär, Zürcher Kantonalbank, Vontobel and Leonteq — each with a different positioning and distribution strength.
Question 1 / 3
Why did capital-protected products develop so massively in Switzerland in the 1990s?
Question 2 / 3
What is the main reason for the rise of autocalls since the 2010s?
Question 3 / 3
What role does SIX Structured Products play in the Swiss market?