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(Bloomberg) — Two former brokers at Tradition Securities & Futures OTC SA have partnered with Paris- based OTCex SA to start a new firm selling custom structured products in Europe, the U.S. and Asia.

HPC Investment Partners began offering structured notes from about 15 issuers this month to institutional investors such as asset managers and private banks, according to co-founder Pierre-Yves Breton. The notes track assets such as stocks, bonds, commodities and currencies, and can be bought for as little as 200,000 euros ($224,080).

The London-based firm is seeing demand from investors looking for substitutes to low-yielding debt securities, said co-founder Arthur Teixeira. Monetary stimulus from the European Central Bank has sent euro-zone interest rates to record lows, while pushing up stock prices. Structured products, which package derivatives with debt, can offer higher yields than investment-grade bonds by giving exposure to assets such as equities and exchange rates.

HPC will offer products based on its own strategies as well as third-party research, and will create notes tailored to client requests, said Breton. Over the next 12 months, the firm plans to hire between five and 10 salespeople for offices in London, Paris, Geneva, New York and Hong Kong.
“Our ambition is to be the largest independent broker of structured products in Europe,” Breton said in a telephone interview. The company is targeting $1 billion in sales this year, and $3 billion to $4 billion after two years, he said. Breton and Teixeira departed as directors at Paris-based Tradition in February and December, respectively. At Tradition, Breton was responsible for structured-product sales in Switzerland and the Nordic region, while Teixeira covered Belgium, Netherlands and Luxembourg.

Virginie de Vichet, a spokeswoman at Tradition, didn’t respond to an e-mail seeking comment.

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