An Exchange Traded Instrument (ETI) is a listed security that packages an investment strategy into a single instrument you can buy and sell through any bank or broker using its ISIN. Legally it is a debt security of its issuer, typically collateralised by the strategy's own assets, rather than a fund.
Most investors know ETFs. Far fewer know ETIs, even though the two trade side by side on the same exchanges. The difference is not cosmetic: it determines who manages your money, what protects it, and which strategies you can actually reach. This guide explains the structure in plain language.
How an ETI works
An ETI starts with a strategy: a defined way of allocating capital, whether systematic or discretionary. A securitisation issuer, such as iMaps ETI AG in Liechtenstein, wraps that strategy into a security issued under a base prospectus approved by the Liechtenstein Financial Market Authority (FMA) and notified across the EU. The capital raised is held in a segregated portfolio dedicated to that instrument, and the security is listed on an exchange, typically Börse Stuttgart (EUWAX), Europe's largest venue for securitised derivatives.
Four distinct roles keep the structure honest:
- The strategy developer designs and supplies the underlying strategy. They do not hold your money.
- The portfolio manager executes the strategy inside the instrument. For the ETIs available through Framont Access, this is Framont & Partners Management Ltd, an AIFM authorised by the Malta Financial Services Authority (MFSA).
- The issuer and market maker issues the security, maintains the segregated portfolio and quotes daily buy and sell prices on the exchange.
- The security trustee, an independent party, holds a pledge over the underlying assets for the benefit of investors.
The collateral structure: what stands behind the paper
Because an ETI is a debt security, the first question a careful investor asks is: what happens if the issuer fails? This is where collateralised ETI structures differ from ordinary bank-issued certificates.
The assets bought by the strategy sit in a segregated portfolio and are pledged to an independent security trustee, who holds them for the benefit of the instrument's investors. If the issuer were to default, the pledged assets are reserved for ETI holders rather than the issuer's general creditors. This mechanism substantially mitigates issuer credit risk. It does not eliminate it, and the precise mechanics are defined in each instrument's prospectus, which is why reading the KID and final terms remains essential.
ETI vs ETF vs AMC vs UCITS fund
The labels sound interchangeable. The structures are not:
| Feature | ETI | ETF | AMC | UCITS fund |
|---|---|---|---|---|
| Legal form | Debt security of the issuer | Fund (segregated assets) | Debt security of the issuer | Fund (segregated assets) |
| Management | Usually active | Usually passive (index) | Active | Active or passive |
| Exchange listing | Yes, with market maker | Yes | Often, not always | Rarely |
| Issuer risk | Yes, mitigated when collateralised | No (fund assets) | Yes, unless collateralised | No (fund assets) |
| Time to launch | Weeks | Months | Weeks | Months |
| Typical minimum | ~€1,000 | One share | Varies, often higher | Varies |
In short: ETFs and UCITS funds give you fund-level asset protection and, usually, index exposure. ETIs and AMCs give you access to specialist, actively managed strategies that would rarely justify the cost and lead time of a full fund launch, in exchange for taking structured, disclosed issuer risk.
How to buy an ETI
- Find the ISIN. Every ETI has one, published on the product page and in the final terms.
- Read the KID and prospectus first. The Key Information Document summarises risks, costs and scenarios on three pages. Your broker must make it available before you invest.
- Place the order through any MiFID-licensed bank or broker. ETIs clear through Euroclear, Clearstream and SIX, so most European brokerage accounts can hold them. You buy on the exchange at the market maker's quote, or over the counter through the paying agent.
- Check the spread. Liquidity comes from the market maker's quotes. Compare bid and ask before trading, particularly for larger orders.
Who can invest
Offering rights differ per instrument. Some ETIs are restricted to professional and institutional investors as defined under MiFID II; others carry retail offering rights in specific jurisdictions, typically with minimums around €1,000. Distributors are required to check eligibility and appropriateness before accepting a subscription, which is why platforms such as Framont Access verify investor category during onboarding.
ETIs on Framont Access
Framont Access currently lists three ETIs, all issued by iMaps ETI AG with portfolio management by Framont & Partners Management Ltd (MFSA-authorised AIFM): HERAKLIT Strategy ETI, a systematic multi-asset strategy built on physics-based regime detection; Tech Megatrend Tactical ETI, a tactical, liquidity-driven US technology strategy; and LC Invest Value Edge ETI, a discretionary gold and FX strategy. Each product page publishes the ISIN, KID, prospectus and fee schedule.