In a departure from tradition, this year marked a significant shift for the SPi USA event as it relocated from the sunny shores of Florida to the vibrant cityscape of Nashville. The decision was rooted in the desire to broaden our reach and provide attendees with the opportunity to experience a fresh setting. The move, it seems, was a resounding success.
The festivities kicked off with lively line dancing preceding the main event, creating an engaging atmosphere. Throughout the day and evenings, participants engaged in extensive networking, providing ample opportunities to discover emerging trends and best practices.
The event commenced with a comprehensive quarterly review of the US market. The presentation not only delved into the latest trends but also explored the correlated products between S&P500 and S&P500 equal weight. Particularly noteworthy was the substantial growth in income products, featuring lower coupon barriers and innovative callable yield MLCDs. The presentation concluded by forecasting that the US market is poised to set a record-breaking sales volume of over $120 billion by year-end.
Looking ahead to 2024, the event unveiled the first estimate for the upcoming year. Projections hinge on equity performance, especially considering the average structured product currently sits at 5% below its initial level. The estimates suggest a modest decrease to $119 billion or a slight increase to $122 billion if the S&P 500 reaches the 4,300 to 4,600 level by the beginning of 2024.
The highlight of the event was an insightful Q&A session with economist Nouriel Roubini. Roubini painted a vivid picture of potential global catastrophes, ranging from double-digit inflation and new viruses to the profound impact of climate change on real estate. Amidst the gloom, Roubini introduced the Atlas project, a collaboration with Goldman Sachs aiming to invest in commodities and real estate that can thrive amidst environmental changes. The initiative was officially announced during the conference, initially focusing on annuities and potentially expanding to other investment vehicles.
A contrasting perspective was presented by Professor Jeremy Siegel during another Q&A session. Siegel maintained a negative view of the Federal Reserve but expressed optimism about equity performance in 2024. The divergent opinions underscored the volatile nature of the financial landscape, encapsulated by one speaker’s quote: “Volatility is volatile.”
The morning sessions also featured discussions on the future of wholesaling and the relevance of annuities. The former explored the impact of technology on wholesaling, questioning the value proposition of banks attempting to emulate independent wholesalers. The annuities panel tackled the question of their worth after a year of negative performance, with all panelists asserting their long-term value in managing budgets and mitigating risk.
The afternoon was marked by engaging panels featuring leaders from the sell-side and distributors of structured products. Notably, the discussions revolved around the integration of artificial intelligence to reduce costs and further automate structured products.
Despite a change in speakers due to unforeseen circumstances, the technology-focused sessions persevered. Lauren Drenning from LPL stepped in to discuss presenting structured products to investors and RIAs. While the panel emphasizing the role of AI in idea generation. Platforms’ costs were addressed, with the consensus being that their benefits far outweigh the expenses, a sentiment echoed by those in the fintech industry.
The SPi USA 2023 event concluded on a high note with the presentation of awards. Goldman Sachs claimed the Derivatives House Award of 2023, JP Morgan secured the Best Issuer accolade, and Morgan Stanley Wealth received the prestigious Broker-Dealer Award. The evening was further elevated by the celebration of personal and professional achievements, as Mark Landers was inducted into the Hall of Fame alongside Eric Glicksman and Rob Sowinski. The night concluded on the lively streets of Nashville, echoing with rock music, as attendees celebrated the successes of 2023 and eagerly anticipated an even better 2024.
