Investment Fundamentals Forum 21 January 2013

Save this PDF as:

Size: px
Start display at page:

Download "Investment Fundamentals Forum 21 January 2013"

Transcription

1 Investment Fundamentals Forum 21 January 2013 Understanding and Trading Equity & Related Products in Singapore Th ng Beng Hooi, CFA 1 Speaker Biography Th ng Beng Hooi, CFA 2

2 Disclaimer Please note that the information is provided for you by way of information only. All the information, report and analysis were and should be taken as having been prepared for the purpose of general circulation and that none were made with regard to any specific investment objectives, financial situation and particular needs of any particular person who may receive the information, report or analysis (including yourself). Any recommendation or advice that maybe expressed in or inferred from such information, reports or analysis therefore does not take into account and may not be suitable for your investment objectives, financial situation and particular needs. You understand that you buy and/or sell and/or take any position in/or on the market, in any of the stocks, shares, products or instruments etc. based on your own decision(s). This is regardless of whether the information is analysed or not, regardless of the details or information related to price levels, support/resistance levels and any information based on technical or fundamental analysis. You understand and accept that nothing told or provided to you whether directly or indirectly is to be a basis for your decision(s) in relation to the market or your trades or transaction(s). Please see a registered trading representative or financial adviser for formal advise. 3 WHAT S AVAILABLE? 4

3 5 What Are Specified Investment Products? Some products listed on SGX may have terms and features that are not as well known and widely understood as others. These are referred to as Specified Investment Products. 6

4 What Are Specified Investment Products? Specified investment products (Listed) include: Certificates Exchange Traded Funds (ETFs) Exchange Traded Notes (ETNs) Extended Settlement Contracts Structured Warrants Callable Bull / Bear Contracts (CBBCs) Not yet launched 7 What Are Specified Investment Products? Specified investment products (Unlisted) include: CFDs Leveraged FX Equity Linked Notes Other Structured Products 8

5 What Are Specified Investment Products? Specified investment products (Unlisted) include: CFDs Leveraged FX Equity Linked Notes Other Structured Products 9 What Are Excluded Investment Products? Shares Fully paid depository receipts representing shares Subscription rights pursuant to rights issues Company issued warrants/derivatives Units in business trusts Units in real estate investment trusts Debentures (other than asset backed securities & structured notes All above must be listed 10

6 AMERICAN DEPOSITORY RECEIPTS 11 Risks Market & Company Specific Risk Foreign Currency Risk Foreign Political, Social and Economic Risk Price Risk (tracking error) 12

7 INTRODUCTION TO EXCHANGE TRADED FUNDS 13 What Are Exchange Traded Funds? An investment vehicle traded on the Singapore Exchange (SGX) like any other security (e.g. stocks). The ETF invests in a basket of securities in order to track a stated index. For example: the STI ETF tracks the STI index. 14

8 What Are Exchange Traded Funds? ETFs exist for many asset types: stocks, bonds, commodities and currencies. ETFs that track certain stock sectors or geographical markets are also available. For example: the ishares Dow Jones US Technology Sector Index Fund tracks the tech sector of the DJIA. 15 What Are Exchange Traded Funds? An ETF is like a unit trust fund with the following features: Invests in assets of your choice. Listed on SGX. Traded like any other stock. Brokerage fees similar to any other stock. Low annual management fees. 16

9 Direct Replication (Cash Based) Full Replication ETF holds same constituent stocks in the same weightage as the stated index. Higher tracking error due to expenses and tax withholdings on dividend payments. No counter party risk. Representative Sample ETF holds only selected constituent stocks that have high correlation with stated index. Higher tracking error due to expenses and tax withholdings on dividend payments. No counter party risk. 17 Synthetic Replication Swap Based Use swaps to gain performance similar to the stated index. Swaps used may not even be the same constituent stocks. Lower tracking error as swaps give more precise tracking to the stated index. Counter party risk arising from swap agreement. Derivative Embedded Use derivatives to replicate the stated index. Derivatives used are warrants and participatory notes. Higher tracking error due to higher cost of derivatives. Counter party risk arising from possibility of default. 18

10 Low Cost Benefits of Trading ETFs Most ETFs track a stated index. No active management means low management fees. No sales charge (unlike unit trust funds). Trading Flexibility ETFs can be traded any time during market hours. All current order types can be used e.g. market order, limit order, stop loss order etc. Diversification Extremely efficient and economical to diversify using ETFs. Requires only a relatively small cash outlay to gain market exposure. Transparency No investment style drift. So WYSWYG What You See is What You Get. Minimum cash drag. Because ETFs are almost fully invested, little cash is held for redemption purposes (unlike unit trust funds). 19 Comparison of ETFs, Unit Trust Funds and Stocks ETF Unit Trust Fund Stock Diversification Excellent Excellent None Continuous Pricing Intraday End of Day Intraday Sales Charge 0% 3% 5% 0% Fee Structure Brokerage 0.1% 0.4% 0% 0.1% 0.4% Management Fees Less than 1% 1% 2% 0% Settlement Date T +3 Upfront T + 3 Can Contra? Yes (SGX only) No Yes (SGX only) Dividend Payout Yes Yes Yes 20

11 Market and Sector Risk Risks in Trading ETFs ETF is exposed to broad market and sector movements. Sudden adverse movement in the wider market and sector will impact the value of the ETF. Tracking Error ETF is unable to exactly track the performance of the stated index. This could be because of transaction costs, withholding taxes on dividends etc. Counter Party Risk Run the risk of default or the counter party failing to honour its obligations. Applies more to synthetically created ETFs. Foreign Exchange Risk ETFs denominated in foreign currency are exposed to adverse currency movements against the investor. FX risk needs to be considered or managed. 21 Strategic Allocation Examples on Trading ETFs Long term, buy and hold strategy. Gain exposure to broad market movements for low brokerage and management fees. Tactical Trading Short term trading for the purposes of speculative profits. Relatively less risky than investing in specific stocks because of diversification. Core + Satellite Investing Core piece composed of broad market ETFs. Satellite created by picking riskier stocks in hopes of higher returns. Overall portfolio return = core return + satellite return. Hedging ETFs are ideal for hedging due to low cost and relatively less risk exposure compared to derivative products. 22

12 INTRODUCTION TO STRUCTURED WARRANTS 23 What Are Structured Warrants? An investment vehicle issued by financial institutions (issuers) which enable investors to: Participate in the performance of the underlying stock. At a fraction of its price. Investor s capital is freed up for other investing or trading purposes. 24

13 Types of Structured Warrants A call warrant gives the holder the right but not the obligation to buy the underlying asset at the exercise price. Increases in value if the price of the underlying goes up. A put warrant gives the holder the right but not the obligation to sell the underlying asset at the exercise price. Increases in value if the price of the underlying drops. 25 Structured Warrant Features Exercise price The predetermined price which is fixed before the warrant is listed. Exercise style Structured warrants listed on SGX ST are primarily European style. Meaning the warrants can only be exercised on expiry date. 26

14 Structured Warrant Features Expiry date Warrants have a finite lifespan and cease to exist once its expired. Conversion ratio Also known as the entitlement ratio. The number of warrants needed to exercise into 1 unit of the underlying asset. Example: conversion ratio of 3 means 3 warrants are needed to convert into 1 unit of the underlying asset. 27 Concept of Moneyness Scenario Call Warrant Put Warrant Underlying Asset Price Greater Than Exercise Price In The Money Out Of The Money Underlying Asset Price Exactly the Same As Exercise Price At The Money At The Money Underlying Asset Price Less Than Exercise Price Out Of The Money In The Money 28

15 Determining the Price of a Warrant The price of a warrant has two components: Intrinsic value Time value Warrant Price = Intrinsic Value + Time Value 29 Determining the Price of a Warrant What is Intrinsic Value? Difference between the price of the underlying asset and the warrant s exercise price when the warrant is in the money. 30

16 Determining the Price of a Warrant What is Time Value? The warrant has value only when it has not reached its expiry date. At expiry date, the warrant expires and is worthless. Time Value Rate of Time Decay Maturity 31 For example, Price of a Call Warrant Current price of underlying asset is $4.80 Call warrant s exercise price is $4.50 Time value of warrant is $0.40 Intrinsic value is $0.30 ($4.80 $4.50) Warrant price is then $0.70 ($ $0.30) 32

17 For example, Price of a Put Warrant Current price of underlying asset is $3.00 Put warrant s exercise price is $3.20 Time value of warrant is $0.20 Intrinsic value is $0.20 ($3.20 $3.00) Warrant price is then $0.40 ($ $0.20) 33 Structured Warrant Names Warrant name: HSI18400MBECW Item Term Explanation Underlying asset HSI Hang Seng Index Exercise price Warrant is exercisable when the HSI reaches 18,400 points. Issuer MB Macquarie Bank Type ECW European style Call warrant. Expiry date In YYMMDD format. The expiry date for this warrant is Nov 29 th

18 Benefits of Trading Structured Warrants Leverage Gain exposure to an underlying asset at only a fraction of its price. Investors have complete flexibility in deciding how much leverage or gearing they need. The greater the amount of leverage, the greater the percentage change in the warrant price when the price of the underlying changes. Cash Extraction For the same amount of exposure, investors only need to pay for a fraction of underlying s price. Investor s capital is freed up for other investing or trading purposes. Limited Downside Losses Limited only to the amount paid for the warrants. Potential losses from investing in the underlying asset can be much higher. However, potential gains from call warrants are unlimited. 35 Benefits of Trading Structured Warrants Portfolio Protection Put warrants can be used as a hedge. Especially useful for investors with long term long positions or portfolios. Diverse Market Access Good selection of warrants for local and foreign stocks and indices. No Margin Calls There are no margin calls. Cash top up is unnecessary unlike Contract for Differences (CFDs) or Options. Index Warrants No special stock picking skills needed. Take a macro view of overall market instead. Only exposed to market risk and not stock specific risk. Useful for hedging purposes. 36

19 Risks in Trading Structured Warrants Limited Lifespan Structured warrants have limited lifespans. Potential gains are only realized if the warrants are in the money on the expiry date. Investors will lose the what they had paid for the warrants if they expire at the money or out of the money. Leverage Both potential gains and losses are magnified by the use of leverage. However losses are only limited to what the investor had paid for the warrants. Issuer Risk Warrants are issued by financial institutions as unsecured financial instruments. Warrant holders do not have additional protection and will be treated as any other creditor in the event that the financial institution is unable to fulfill its obligations. 37 Risks in Trading Structured Warrants Currency Risk Investors bear the FX risk for warrants denominated in foreign currencies. Some issuers may offer warrants localized into SGD on a notional 1 for 1 basis. This shields investors from FX risk. Market Risk Similar to all other types of securities, warrants are exposed to market risk. Movements in broader market may impact the price of the underlying asset and hence the value of the warrants. Market risk also includes market forces such as the demand and supply of warrants. Suspension from Trading If the underlying asset is suspended or halted from trading, SGX may impose a similar suspension or halt in the trading of its warrants. Warrant holders may not be able to exit their positions at a time of their choosing or may have to exit at a loss. 38

20 Examples of Trading Structured Warrants Cash Extraction and Freeing Up Capital Market conditions are volatile and investor wants to hold larger cash reserves: To take advantage of opportunities for cheap bargains when they appear. As a buffer against volatility. However investor wants to maintain exposure to stock price movements. Sell the stock holdings and use some of the cash to buy warrants. 39 Examples of Trading Structured Warrants Portfolio Hedging Investor intends to hold his stock portfolio for the long term. Very common to use CPF to buy good Singapore stocks that pay decent dividends and hold them to forever. However market volatility and downside risk is increasing. Buy put warrants to hedge against down side risk. 40

21 INTRODUCTION TO FUTURES 41 What Is A Futures Contract? A futures contract is an agreement to buy or sell an asset at a specified price to be delivered at some specified future time. Broad categories of futures contracts: Commodity futures Example: Metals, agriculture and energy related. Financial futures Example: Stock indices and interest rates. 42

22 What Is A Futures Contract? Features of a futures contract Standardized contract with standardized quality and quantity. Both buyers and sellers of futures are obligated to fulfill the contract on settlement or delivery date. Commodity futures are physically settled. Financial futures are cash settled. 43 What Is A Futures Contract? Features of a futures contract Traded on SGX DT as a derivative product. Traded on margin (i.e. leveraged). Futures can be traded any time during market hours up to the settlement date. Short selling is permitted. Value of futures is marked to market daily and impacts the investor s margin balance. 44

23 Benefits of Trading Futures Contracts Hedging with Commodity Futures Users of the actual commodity can hedge against adverse supply situations. For example A maker of shoes needs to secure a steady supply of rubber for next year. Buying a SICOM rubber futures contract ensures rubber delivery is not disrupted regardless of market conditions in the next year. Hedging with Financial Futures Investors can take a futures position that is opposite from what they are holding. In a perfect hedge, gains on one position will be net off by losses on the other position regardless of how the market moves. Example: Sell STI index futures contracts as a hedge to a portfolio of STI component stocks. Speculative Trading Buy and sell futures contracts for capital gains. Investor buys futures if he believes prices of the underlying asset will rise. Investor sells futures if he believes prices of the underlying asset will fall. 45 Risks in Trading Futures Contracts Hedging Imperfections Price movements in the underlying asset of a futures contract may not move closely to the value of shares being hedged. The value of the shares being hedged may not exactly equal the value of the futures contracts. The hedge may then over or undershoot. Liquidity Risk Liquidity can dry up in a rapidly rising or falling market. For example, a futures contract has risen or fallen by the maximum allowable daily limit. No counter party is available for investors to offset their positions. Leveraged Losses Futures are traded using margins. Both losses and gains are magnified through the leverage effect. 46

24 Examples of Trading Futures Contracts Hedging a Stock Portfolio An investor is holding a long term portfolio of STI component stocks. The portfolio s value is about $550,000 and the current STI index level is 2,760. The investor shorts 20 contracts of the STI index futures as a hedge. The market corrects and on settlements date, the STI index level is 2, Examples of Trading Futures Contracts Hedging a Stock Portfolio Investor s stock portfolio has lost about $31,884 (160 / 2760 x $550,000). However, her futures position has gained $32,000 (160 x 20 x $10). Investor s net position is $

25 INTRODUCTION TO OPTIONS 49 What Is An Option? An investment vehicle developed by SGX which enable investors to: Participate in the performance of the underlying asset. At a fraction of its price. Options are similar to structured warrants but with some key differences. 50

26 Types of Options A call option gives the option buyer the right but not the obligation to buy the underlying asset at the exercise price. Increases in value if the price of the underlying goes up. A put option gives the option buyer the right but not the obligation to sell the underlying asset at the exercise price. Increases in value if the price of the underlying drops. 51 Exercise price Option Features The predetermined price which is fixed before the option is listed. Exercise style Options traded on SGX DT are European style. Meaning the options can only be exercised on expiry date. 52

27 Expiry date Options Features Options have a finite lifespan and cease to exist once its expired. Investors can buy, sell and write options Buy: investor buys an option from SGX. Sell: investor sells an option which she already owns. Write: investor sells an option which she does not already own (similar to short sales). 53 Concept of Moneyness Scenario Call Option Put Option Underlying Asset Price Greater Than Exercise Price In The Money Out Of The Money Underlying Asset Price Exactly the Same As Exercise Price At The Money At The Money Underlying Asset Price Less Than Exercise Price Out Of The Money In The Money 54

28 Determining the Price of an Option The price of an option has two components: Intrinsic value Time value Option Price = Intrinsic Value + Time Value 55 Determining the Price of an Option What is Intrinsic Value? Difference between the price of the underlying asset and the option s exercise price when the option is in the money. 56

29 Determining the Price of an Option What is Time Value? The option has value only when it has not reached its expiry date. At expiry date, the option expires and is worthless. Time Value Rate of Time Decay Maturity 57 For example, Price of a Call Option Current price of underlying asset is $12.00 Call option s exercise price is $11.20 Time value of option is $0.70 Intrinsic value is $0.80 ($12.00 $11.20) Option price is then $1.50 ($ $0.80) 58

30 For example, Price of a Put Option Current price of underlying asset is $6.30 Put option s exercise price is $8.00 Time value of option is $0.30 Intrinsic value is $1.70 ($8.00 $6.30) Option price is then $2.00 ($ $1.70) 59 Leverage Benefits of Trading Options Gain exposure to an underlying asset at only a fraction of its price. Investors have complete flexibility in deciding how much leverage or gearing they need. The greater the amount of leverage, the greater the percentage change in the Option price when the price of the underlying changes. Cash Extraction For the same amount of exposure, investors only need to pay for a fraction of underlying s price. Investor s capital is freed up for other investing or trading purposes. Limited Downside Losses (Does not apply to option writers) Limited only to the amount paid for the options. Potential losses from investing in the underlying asset can be much higher. However, option writers face unlimited liabilities and much higher potential losses. 60

31 Limited Lifespan Risks in Trading Options Options have limited lifespans. Potential gains are only realized if the options are in the money on the expiry date. Investors will lose the what they had paid for the options if they expire at the money or out of the money. Leverage Both potential gains and losses are magnified by the use of leverage. Option Writer s Risk Option writers face unlimited contingent liabilities. Contingent liabilities are realized at the expiry date if the option writers are out of the money. Potential losses can be significant. 61 Risks in Trading Options Currency Risk For options denominated in foreign currencies, exchange rate fluctuations may have adverse effects on the value, price or return of options. Market Risk Similar to all other types of securities, options are exposed to market risk. Movements in broader market may impact the price of the underlying asset and hence the value of the options. Market risk also includes market forces such as the demand and supply of options. Suspension from Trading If the underlying asset is suspended or halted from trading, SGX may impose a similar suspension or halt in the trading of its options. Option holders may not be able to exit their positions at a time of their choosing or may have to exit at a loss. 62

32 Structured Warrants vs. Options. Structured Warrants Options Issuer Financial institution SGX Trading Market Securities market Derivatives market Trading Mechanism Buy and sell only Buy, sell and write (short sell) Product Features Settlement Maximum Liability Wide range of exercise prices and expiry dates Cash settled Amount paid for warrants Standardized and limited exercise prices and expiry dates Cash (index options) and physically (stock options) settled. Potentially unlimited losses for writers Margin Requirements None Only for writers 63 Examples of Trading Options Portfolio Hedging Investor intends to hold his stock portfolio for the long term. Very common to use CPF to buy good Singapore stocks that pay decent dividends and hold them to forever. However market volatility and downside risk is increasing. Buy put options to hedge against down side risk. 64

33 Examples of Trading Options Speculative Trading Selected basic option strategies Rising Volatility Falling Volatility Bullish Long call option Short put option Bearish Long put option Short call option Undecided Long straddle Short straddle 65 INTRODUCTION TO CERTIFICATES Discount Cert Long Note + short Put 66

34 What Is A Certificate? A certificate is an investment product issued by a third party financial institution, offering investment opportunities based on different market themes and expectations. Requires minimal capital as compared to investing directly in the underlying assets. Price movement of certificates is transparent to investors. 67 Discount Certificates Allows an investor to buy into the performance of an underlying asset at a discount to its actual price. The potential gain to the investor is limited to a maximum amount called the cap strike. The cap strike is predetermined at the time of issue and remains constant till the expiry date. Discount certificates are also known as call spread warrants. 68

35 How Do Discount Certificates Work? Shares of OCBC Bank are trading at $8.00. A 6 month discount certificate on OCBC with a cap strike of $7.50 costs $7.00. So investors may get the share at $7.00 which represents a discount of 12.5%. At the expiry date, there are 3 possible scenarios. 69 How Do Discount Certificates Work? Scenario 1 Price of OCBC share is above cap strike. Regardless of actual share price, discount certificate is settled in cash. Investor is paid $7.50 (the cap strike). Return is 7.14% ($7.50/$7.00 1) 70

36 How Do Discount Certificates Work? Scenario 2 Price of OCBC share is $7.40. This price is below cap strike but above the price paid for the discount certificate. Investor gets one share of OCBC. And realizes an immediate gain of $0.40 ($7.40 $7.00). Return is 5.71% ($7.40/$7.00 1) 71 How Do Discount Certificates Work? Scenario 3 Price of OCBC share is $6.80. This price is below both the cap strike and the price paid for the discount certificate. Investor gets one share of OCBC. And makes a loss of $0.20 ($7.00 $6.80). Loss is 2.86% ($6.80/$7.00 1). However the loss is smaller than if the investor had bought the share directly. 72

37 Participation Certificates Essentially zero strike warrants. Tracks the performance of the underlying asset with no leverage. Enables investors to overcome foreign market trading restrictions and settlement processes. All trades are settled through SGX. 73 Participation Certificates No time decay and no premium payments. Investor s gain or loss roughly equivalent to Gain or loss on the underlying asset and Gain or loss on the FX rate 74

38 How Do Participation Certificates Work? Value of participation certificate at any time Value = Underlying index value x Forex rate Exercise amount Exercise amount is a predetermined number set by the issuer. Remains fixed until certificate matures. 75 Daily Lock In Certificates Daily Lock In Certificates is a structured product with a daily accrual feature. Investor accumulates a lock in amount if the underlying shares or indices perform within a stipulated range. No accumulation of any return otherwise. 76

39 How Do Daily Lock In Certificates Work? Knock Out Level Issuer sets a pre determined level for certificates to knock out. Essentially means that the issuer has the right to call the certificate. If this occurs, investor will get initial investment back plus any accrued lock in amount. 77 How Do Daily Lock In Certificates Work? Knock In Strike Level Is a pre determined level set by the issuer. On valuation date (i.e. maturity), If the price of the underlying asset is above the knock in strike level, investor gets initial investment back plus any accrued lock in amount. Otherwise, investor loses some of initial investment but still receives any accrued lock in amount. Investor loses all of initial investment if price of underlying falls to zero. 78

40 Double Chance Certificates Double Chance Certificates is a short term investment product. Its payout is dependent on the performance of the underlying asset at expiry. Same amount of risk compared to directly investing in the underlying stocks. May offer investors the chance of doubling their investment returns, if held to expiry. 79 How Do Double Chance Certificates Work? Determination Price Issuer sets a pre determined level as the Determination Price. At expiry, Investor makes a return if price of underlying is above the Determination Price. Otherwise, investor will receive one share of the underlying instead. 80

41 How Do Double Chance Certificates Work? Cap Strike At expiry, If price of underlying is above Determination Price but below the Cap Strike, investor s return is: Gain = 2 x (Price of underlying Purchase Price) 81 How Do Double Chance Certificates Work? Cap Strike At expiry, If price of underlying is above Determination Price and above the Cap Strike, investor s return is: Gain = 2 x (Cap Strike Purchase Price) 82

42 Benefits of Trading Certificates Diversification Access to foreign markets and instruments without restrictions of foreign jurisdiction or potential high cost of trading. Yield Enhancing Able to increase potential returns in a flat or sideways moving market. Liquidity and Low Minimum Investment Market maker is obligated to provide liquidity at competitive bid and ask prices. Investors can trade at any time during market hours. Only 1 lot (1,000 units) as minimum investment. Low and Transparent Costs Cost of trading is only the brokerage fee plus a bid ask spread. No sales charge or management fee (unlike a unit trust fund). However, dividends on stocks is absorbed by issuers (only for participation certificates). 83 Credit Risk Risks in Trading Certificates Certificates are issued by third party financial institutions. There is a risk that these institutions are unable to fulfill their obligations to settle the transactions. Liquidity Risk Rapidly rising or falling markets may lead to a possibility of certificates holders being unable to sell his certificates at a reasonable price. Market Risk Similar to all other types of securities, certificates are exposed to market risk. Movements in the broader market may impact the price of the underlying asset and hence the value of the certificates. Exchange Rate Risk For certificates denominated in foreign currencies, exchange rate fluctuations may have adverse effects on the value, price or return of certificates. 84

43 INTRODUCTION TO EXCHANGE TRADED NOTES 85 What Is An ETN? An ETN is an investment product issued by a third party financial institution, over a wide range of assets. Combines both the benefits and risks common to investments in bonds and exchange traded funds (ETFs). Returns of ETNs track the performance of an underlying asset and is also dependent on the credit rating of the issuer. 86

44 Ease of Access Benefits of Trading ETNs Grants convenient access to asset classes, markets and sectors that investors ordinarily may find difficult to access. Overcomes foreign market trading restrictions, investment limits and capital controls. Intraday Exchange Liquidity Traded like stocks. Market makers provide real time bid and ask prices during market hours. All traditional trading techniques can be employed for ETNs. Transparent Performance Tracking Tracks performance of market benchmarks, commodity prices, currency pairs. Indicative value of ETN is calculated on a daily basis and made available via issuer s websites. 87 Credit Risk Risks in Trading ETNs ETNs are not backed by a pool of assets held in trusts (unlike ETFs). Solely reliant on the issuer s ability to make payments. There is a risk that these institutions are unable to fulfill their obligations to settle the transactions. Credit rating of the issuer is important to gauge financial strength of the issuer. Liquidity Risk Rapidly rising or falling markets may lead to a possibility of ETN holders being unable to sell his ETNs at a reasonable price. Redemptions can only be made in large blocks (typically 50,000 units). Market Risk Similar to all other types of securities, ETNs are exposed to market risk. Movements in the broader market may impact the price of the underlying asset and hence the value of the ETNs. Exchange Rate Risk For ETNs denominated in foreign currencies, exchange rate fluctuations may have adverse effects on the value, price or return of ETNs. 88

45 End of the Session Questions? 89

Risk Explanation for Exchange-Traded Derivatives

Risk Explanation for Exchange-Traded Derivatives Risk Explanation for Exchange-Traded Derivatives The below risk explanation is provided pursuant to Hong Kong regulatory requirements relating to trading in exchange-traded derivatives by those of our

More information

Derivative Products Features and Risk Disclosures

Derivative Products Features and Risk Disclosures Derivative Products Features and Risk Disclosures Table of Content Warrants... 3 Callable Bull/Bear Contracts (CBBC)... 5 Exchange Traded Fund (ETF)... 7 Listed equity linked instruments (ELI/ELN)... 9

More information

Risk Warning Notice. Introduction

Risk Warning Notice. Introduction First Equity Limited Salisbury House London Wall London EC2M 5QQ Tel 020 7374 2212 Fax 020 7374 2336 www.firstequity.ltd.uk Risk Warning Notice Introduction You should not invest in any investment product

More information

Complex Products. Non-Complex Products. General risks of trading

Complex Products. Non-Complex Products. General risks of trading We offer a wide range of investments, each with their own risks and rewards. The following information provides you with a general description of the nature and risks of the investments that you can trade

More information

Section 1 Important Information... 2. Section 2 Regulatory Guide 227... 2. Section 3 Features... 3. Section 4 How to Trade... 8

Section 1 Important Information... 2. Section 2 Regulatory Guide 227... 2. Section 3 Features... 3. Section 4 How to Trade... 8 CONTENTS Section 1 Important Information... 2 Section 2 Regulatory Guide 227... 2 Section 3 Features... 3 Section 4 How to Trade... 8 Section 5 Significant Risks... 32 Section 6 Costs, Fees & Charges...

More information

RISK DISCLOSURE STATEMENT PRODUCT INFORMATION

RISK DISCLOSURE STATEMENT PRODUCT INFORMATION This statement sets out the risks in trading certain products between Newedge Group ( NEWEDGE ) and the client (the Client ). The Client should note that other risks will apply when trading in emerging

More information

Risks involved with futures trading

Risks involved with futures trading Appendix 1: Risks involved with futures trading Before executing any futures transaction, the client should obtain information on the risks involved. Note in particular the risks summarized in the following

More information

SG TURBOS GEARED EXPOSURE TO AN UNDERLYING WITH A KNOCK-OUT FEATURE

SG TURBOS GEARED EXPOSURE TO AN UNDERLYING WITH A KNOCK-OUT FEATURE SG TURBOS GEARED EXPOSURE TO AN UNDERLYING WITH A KNOCK-OUT FEATURE Turbos are products suitable for UK sophisticated retail and professional investors who have a good understanding of the underlying market

More information

Answers to Concepts in Review

Answers to Concepts in Review Answers to Concepts in Review 1. Puts and calls are negotiable options issued in bearer form that allow the holder to sell (put) or buy (call) a stipulated amount of a specific security/financial asset,

More information

PART III TERMS APPLICABLE TO RESPECTIVE ACCOUNTS Schedule A Terms for Cash Account / Margin Account. 5. Pilot Programme for Trading US Securities

PART III TERMS APPLICABLE TO RESPECTIVE ACCOUNTS Schedule A Terms for Cash Account / Margin Account. 5. Pilot Programme for Trading US Securities Additional information to the Client Trading Master Document Terms and Conditions (Version 6) are set out in this appendix. To download the online version, please visit our company website http://www.cashon-line.com.

More information

PRODUCT DISCLOSURE STATEMENT CONTRACTS FOR DIFFERENCE

PRODUCT DISCLOSURE STATEMENT CONTRACTS FOR DIFFERENCE STA Global Investments Pty Ltd (ACN 158 641 064) Trading as Trade.com Level 29, 66 Goulburn Street Sydney NSW 2000 Australia PRODUCT DISCLOSURE STATEMENT CONTRACTS FOR DIFFERENCE AUSTRALIAN FINANCIAL SERVICES

More information

Non-Complex Products. Complex Products. General risks of trading

Non-Complex Products. Complex Products. General risks of trading We offer a wide range of investments, each with their own risks and rewards. The following information provides you with a general description of the nature and risks of the investments that you can trade

More information

Maybank Kim Eng Securities Pte Ltd Terms and Conditions

Maybank Kim Eng Securities Pte Ltd Terms and Conditions Maybank Kim Eng Securities Pte Ltd Terms and Conditions Risk Disclosure Statement Telephone Email Website : (65) 6432 1888 (Singapore and Overseas) : helpdesk@maybank-ke.com.sg : www.maybank-ke.com.sg

More information

Contents. 2 What are Options? 3 Ways to use Options. 7 Getting started. 8 Frequently asked questions. 13 Contact us. 14 Important Information

Contents. 2 What are Options? 3 Ways to use Options. 7 Getting started. 8 Frequently asked questions. 13 Contact us. 14 Important Information Options For individuals, companies, trusts and SMSFs The Options and Lending Facility Contents 2 What are Options? 3 Ways to use Options 7 Getting started 8 Frequently asked questions 13 Contact us 14

More information

Risks of Investments explained

Risks of Investments explained Risks of Investments explained Member of the London Stock Exchange .Introduction Killik & Co is committed to developing a clear and shared understanding of risk with its clients. The categories of risk

More information

Market Linked Certificates of Deposit

Market Linked Certificates of Deposit Market Linked Certificates of Deposit This material was prepared by Wells Fargo Securities, LLC, a registered brokerdealer and separate non-bank affiliate of Wells Fargo & Company. This material is not

More information

IntroductIon to commsec cfds

IntroductIon to commsec cfds Introduction to CommSec CFDs Important Information This brochure has been prepared without taking account of the objectives, financial and taxation situation or needs of any particular individual. Because

More information

nabtrade Exchange Traded Options Product Disclosure Statement (PDS)

nabtrade Exchange Traded Options Product Disclosure Statement (PDS) nabtrade Exchange Traded Options Product Disclosure Statement (PDS) WealthHub Securities Limited ABN 83 089 718 249 AFSL No. 230704 GPO Box 4545 Melbourne VIC 3001 Telephone 13 13 80 nabtrade.com.au Preparation

More information

General Forex Glossary

General Forex Glossary General Forex Glossary A ADR American Depository Receipt Arbitrage The simultaneous buying and selling of a security at two different prices in two different markets, with the aim of creating profits without

More information

CHAPTER 20: OPTIONS MARKETS: INTRODUCTION

CHAPTER 20: OPTIONS MARKETS: INTRODUCTION CHAPTER 20: OPTIONS MARKETS: INTRODUCTION PROBLEM SETS 1. Options provide numerous opportunities to modify the risk profile of a portfolio. The simplest example of an option strategy that increases risk

More information

ANZ ETFS PHYSICAL US DOLLAR ETF. (ASX Code: ZUSD)

ANZ ETFS PHYSICAL US DOLLAR ETF. (ASX Code: ZUSD) ANZ ETFS PHYSICAL US DOLLAR ETF (ASX Code: ZUSD) INVESTMENT BUILDING BLOCKS FOR A CHANGING WORLD Introducing a suite of innovative exchange traded funds (ETFs) designed for Australian investors by ANZ

More information

CMC Markets Stockbroking Limited Exchange Traded Options Product Disclosure Statement (PDS)

CMC Markets Stockbroking Limited Exchange Traded Options Product Disclosure Statement (PDS) CMC Markets Stockbroking Limited Exchange Traded Options Product Disclosure Statement (PDS) 16 May 2011 AFSL No. 246381 and ABN 69 081 002 851 Table of contents Table of contents Part 1 01 General introduction

More information

www.optionseducation.org OIC Options on ETFs

www.optionseducation.org OIC Options on ETFs www.optionseducation.org Options on ETFs 1 The Options Industry Council For the sake of simplicity, the examples that follow do not take into consideration commissions and other transaction fees, tax considerations,

More information

Introduction. pic. Top warrant markets include Germany, Switzerland, Italy, Australia, Hong Kong and the United Kingdom.

Introduction. pic. Top warrant markets include Germany, Switzerland, Italy, Australia, Hong Kong and the United Kingdom. Corporate Warrants and Investment Banking pic Contents Introduction 2 What is a warrant? 3 Benefits at a glance 4 Pricing and valuation 9 What are the risks? 12 Barrier warrants 15 Turbos 18 Warrants versus

More information

Structured products. Precision tools. A guide for private investors.

Structured products. Precision tools. A guide for private investors. Structured products Precision tools. A guide for private investors. Structured products are listed securities available for trading on London Stock Exchange s regulated Main Market. Structured products

More information

Content. Executive Summary. What is a CFD? Who are the participants? Advantages of trading CFDs. Features and benefits of CFDs. Reasons for using CFDs

Content. Executive Summary. What is a CFD? Who are the participants? Advantages of trading CFDs. Features and benefits of CFDs. Reasons for using CFDs Corporate Retail Contracts and Investment for Difference Banking Content Executive Summary What is a CFD? Who are the participants? Advantages of trading CFDs Features and benefits of CFDs Reasons for

More information

OPTIONS EDUCATION GLOBAL

OPTIONS EDUCATION GLOBAL OPTIONS EDUCATION GLOBAL TABLE OF CONTENTS Introduction What are FX Options? Trading 101 ITM, ATM and OTM Options Trading Strategies Glossary Contact Information 3 5 6 8 9 10 16 HIGH RISK WARNING: Before

More information

Introduction to Options

Introduction to Options Introduction to Options By: Peter Findley and Sreesha Vaman Investment Analysis Group What Is An Option? One contract is the right to buy or sell 100 shares The price of the option depends on the price

More information

Reference Manual Currency Options

Reference Manual Currency Options Reference Manual Currency Options TMX Group Equities Toronto Stock Exchange TSX Venture Exchange TMX Select Equicom Derivatives Montréal Exchange CDCC Montréal Climate Exchange Fixed Income Shorcan Energy

More information

Trading CFDs with Trader Dealer ABN 17 090 611 680 (AFSL NO 333297)

Trading CFDs with Trader Dealer ABN 17 090 611 680 (AFSL NO 333297) Trading CFDs with Trader Dealer ABN 17 090 611 680 (AFSL NO 333297) Pages 1. Overview 3 2. What is a CFD? 3 3. Why Trade CFDs? 3 4. How Do CFDs Work? 4 4.1 Margin 4 4.2 Commission 5 4.3 Financing 6 4.4

More information

RISKS DISCLOSURE STATEMENT

RISKS DISCLOSURE STATEMENT RISKS DISCLOSURE STATEMENT You should note that there are significant risks inherent in investing in certain financial instruments and in certain markets. Investment in derivatives, futures, options and

More information

Exchange-traded Funds

Exchange-traded Funds Mitch Kosev and Thomas Williams* The exchange-traded fund (ETF) industry has grown strongly in a relatively short period of time, with the industry attracting greater attention as it grows in size. The

More information

THE POWER OF FOREX OPTIONS

THE POWER OF FOREX OPTIONS THE POWER OF FOREX OPTIONS TOPICS COVERED Option basics Call options Put Options Why trade options? Covered call Covered put Hedging your position using options How to repair a trading position THE POWER

More information

9 Questions Every ETF Investor Should Ask Before Investing

9 Questions Every ETF Investor Should Ask Before Investing 9 Questions Every ETF Investor Should Ask Before Investing 1. What is an ETF? 2. What kinds of ETFs are available? 3. How do ETFs differ from other investment products like mutual funds, closed-end funds,

More information

Exchange Traded Funds

Exchange Traded Funds LPL FINANCIAL RESEARCH Exchange Traded Funds February 16, 2012 What They Are, What Sets Them Apart, and What to Consider When Choosing Them Overview 1. What is an ETF? 2. What Sets Them Apart? 3. How Are

More information

KKM ARMOR Fund Class A Shares (Symbol: RMRAX) Class I Shares (Symbol: RMRIX)

KKM ARMOR Fund Class A Shares (Symbol: RMRAX) Class I Shares (Symbol: RMRIX) KKM ARMOR Fund Class A Shares (Symbol: RMRAX) Class I Shares (Symbol: RMRIX) KKM U.S. Equity ARMOR Fund Class A Shares (Symbol: UMRAX) Class I Shares (Symbol: UMRIX) Prospectus June 2, 2014 The U.S. Securities

More information

Exchange Traded Options Product Disclosure Statement (PDS)

Exchange Traded Options Product Disclosure Statement (PDS) Bendigo Invest Direct Exchange Traded Options Product Disclosure Statement (PDS) 1 December 2015 A service provided by CMC Markets Stockbroking Limited AFSL No. 246381 and ABN 69 081 002 851 Table of Contents

More information

Nine Questions Every ETF Investor Should Ask Before Investing

Nine Questions Every ETF Investor Should Ask Before Investing Nine Questions Every ETF Investor Should Ask Before Investing UnderstandETFs.org Copyright 2012 by the Investment Company Institute. All rights reserved. ICI permits use of this publication in any way,

More information

Exchange Traded Options Product Disclosure Statement and Application Form

Exchange Traded Options Product Disclosure Statement and Application Form CommSec Adviser Services Phone 1800 252 351 Fax 1300 668 788 Locked Bag 3005 Australia Square NSW 1215 www.commsecadviserservices.com.au advisertrading@cba.com.au Exchange Traded Options Date of Issue:

More information

DISCLAIMER. A Member of Financial Group

DISCLAIMER. A Member of Financial Group Tactical ETF Approaches for Today s Investors Jaime Purvis, Executive Vice-President Horizons Exchange Traded Funds April 2012 DISCLAIMER Commissions, management fees and expenses all may be associated

More information

PRODUCT DISCLOSURE STATEMENT CONTRACTS FOR DIFFERENCE

PRODUCT DISCLOSURE STATEMENT CONTRACTS FOR DIFFERENCE STA Global Investments Pty Ltd (ACN 158 641 064) Trading as Markets.com Level 29, 66 Goulburn Street Sydney NSW 2000 Australia PRODUCT DISCLOSURE STATEMENT CONTRACTS FOR DIFFERENCE AUSTRALIAN FINANCIAL

More information

NATURE AND SPECIFIC RISKS OF THE MAIN FINANCIAL INSTRUMENTS

NATURE AND SPECIFIC RISKS OF THE MAIN FINANCIAL INSTRUMENTS NATURE AND SPECIFIC RISKS OF THE MAIN FINANCIAL INSTRUMENTS The present section is intended to communicate to you, in accordance with the Directive, general information on the characteristics of the main

More information

Frequently asked questions. Hong Kong listed warrant and CBBC market

Frequently asked questions. Hong Kong listed warrant and CBBC market (Last updated: 8 April 2016) Frequently asked questions Hong Kong listed warrant and CBBC market Introduction These FAQs are intended to give you a better understanding of derivative warrants ( warrants

More information

Exchange Traded Options Product Disclosure Statement (PDS)

Exchange Traded Options Product Disclosure Statement (PDS) CMC Markets Stockbroking Limited Exchange Traded Options Product Disclosure Statement (PDS) 28 June 2013 AFSL No. 246381 and ABN 69 081 002 851 Table of Contents Table of contents Part 1 01 General introduction

More information

9 Questions Every ETF Investor Should Ask Before Investing

9 Questions Every ETF Investor Should Ask Before Investing 9 Questions Every ETF Investor Should Ask Before Investing 1. What is an ETF? 2. What kinds of ETFs are available? 3. How do ETFs differ from other investment products like mutual funds, closed-end funds,

More information

FX Key products Exotic Options Menu

FX Key products Exotic Options Menu FX Key products Exotic Options Menu Welcome to Exotic Options Over the last couple of years options have become an important tool for investors and hedgers in the foreign exchange market. With the growing

More information

Client Acknowledgement. Risk Warning Notice for CFDs

Client Acknowledgement. Risk Warning Notice for CFDs Please read this document fully. IMPORTANT NOTICE Client Acknowledgement Clients (including account applicants) of CMC Markets Singapore Pte. Ltd. ( CMC Markets ) should be aware of the risks involved

More information

Exchange Traded Funds A Brief Introduction

Exchange Traded Funds A Brief Introduction Exchange Traded Funds A Brief Introduction spdrs.com What You Need to Know about ETFs ETF Basics Potential Benefits of ETFs ETFs versus Mutual Funds The Role of ETFs in Your Portfolio Our Next Steps Frequently

More information

Exchange Traded Funds A Brief Introduction

Exchange Traded Funds A Brief Introduction Exchange Traded Funds A Brief Introduction 1 What You Need to Know about ETFs 2 ETF Basics Benefits of ETFs ETFs vs. Mutual Funds The Role of ETFs in Your Portfolio Our Next Steps Appendix: FAQs 3 ETF

More information

FP MARKETS CONTRACTS FOR DIFFERENCES PRODUCT DISCLOSURE STATEMENT

FP MARKETS CONTRACTS FOR DIFFERENCES PRODUCT DISCLOSURE STATEMENT FP MARKETS CONTRACTS FOR DIFFERENCES PRODUCT DISCLOSURE STATEMENT Issue Date: 14 January 2013 First Prudential Markets Pty Ltd ABN 16 112 600 281 AFSL 286354 1 FP Markets Contracts For Difference Product

More information

ADVISORSHARES YIELDPRO ETF (NASDAQ Ticker: YPRO) SUMMARY PROSPECTUS November 1, 2015

ADVISORSHARES YIELDPRO ETF (NASDAQ Ticker: YPRO) SUMMARY PROSPECTUS November 1, 2015 ADVISORSHARES YIELDPRO ETF (NASDAQ Ticker: YPRO) SUMMARY PROSPECTUS November 1, 2015 Before you invest in the AdvisorShares Fund, you may want to review the Fund s prospectus and statement of additional

More information

FX Option Solutions. FX Hedging & Investments

FX Option Solutions. FX Hedging & Investments FX Option Solutions FX Hedging & Investments Contents 1. Liability side 2 Case Study I FX Hedging Case Study II FX Hedging 2. Asset side 30 FX Deposits 1 1. Liability side Case Study I FX Hedging Long

More information

WHS FX options guide. Getting started with FX options. Predict the trend in currency markets or hedge your positions with FX options.

WHS FX options guide. Getting started with FX options. Predict the trend in currency markets or hedge your positions with FX options. Getting started with FX options WHS FX options guide Predict the trend in currency markets or hedge your positions with FX options. Refine your trading style and your market outlook. Learn how FX options

More information

EXECUTE SUCCESS. {at work}

EXECUTE SUCCESS. {at work} EXECUTE SUCCESS TM {at work} VIX T H E C B O E V O L A T I L I T Y I N D E X 1 W H AT I S V I X & W H AT D O E S I T M E A S U R E? T H E I N D U S T R Y S TA N D A R D I N V O L AT I L I T Y MEASUREMENT

More information

BASKET A collection of securities. The underlying securities within an ETF are often collectively referred to as a basket

BASKET A collection of securities. The underlying securities within an ETF are often collectively referred to as a basket Glossary: The ETF Portfolio Challenge Glossary is designed to help familiarize our participants with concepts and terminology closely associated with Exchange- Traded Products. For more educational offerings,

More information

EXCHANGE TRADED OPTIONS

EXCHANGE TRADED OPTIONS EXCHANGE TRADED OPTIONS PRODUCT DISCLOSURE STATEMENT (PDS) 11 JULY 2014 CONTENTS Purpose of a PDS 2 About E TRADE 2 Part One: General information 3 1. What products does this PDS cover? 3 2. Overview of

More information

26 th November, 2014. IC Markets CFDs and FOREX (etoro) PRODUCT DISCLOSURE STATEMENT

26 th November, 2014. IC Markets CFDs and FOREX (etoro) PRODUCT DISCLOSURE STATEMENT IC Markets CFDs and FOREX (etoro) PRODUCT DISCLOSURE STATEMENT International Capital Markets Pty Limited ABN 12 123 289 109 Australian Financial Services Licence No. 335 692 26 th November, 2014 International

More information

DMM FX CONTRACTS FOR DIFFERENCE PRODUCT DISCLOSURE STATEMENT

DMM FX CONTRACTS FOR DIFFERENCE PRODUCT DISCLOSURE STATEMENT DMM FX CONTRACTS FOR DIFFERENCE PRODUCT DISCLOSURE STATEMENT DMM FX Australia Pty Limited ACN 160 659 290 AFSL 437734 Issue Date: 7 November 2015 Version 2.0 Table of Contents Section 1 Important Information

More information

A guide to investing inexchange-traded products

A guide to investing inexchange-traded products A guide to investing inexchange-traded products What you should know before you buy Before you make an investment decision, it is important to review your financial situation, investment objectives, risk

More information

PROFUNDS GROUP INVESTOR EDUCATION GUIDE 1 GEARED INVESTING. An introduction to leveraged and inverse funds

PROFUNDS GROUP INVESTOR EDUCATION GUIDE 1 GEARED INVESTING. An introduction to leveraged and inverse funds PROFUNDS GROUP INVESTOR EDUCATION GUIDE 1 GEARED INVESTING An introduction to leveraged and inverse funds GEARED FUNDS have generated a great deal of interest in recent years. Also known as LEVERAGED AND

More information

MARGIN FOREIGN EXCHANGE AND FOREIGN EXCHANGE OPTIONS

MARGIN FOREIGN EXCHANGE AND FOREIGN EXCHANGE OPTIONS CLIENT SERVICE AGREEMENT Halifax New Zealand Limited Client Service Agreement Product Disclosure Statement for MARGIN FOREIGN EXCHANGE AND FOREIGN EXCHANGE OPTIONS Halifax New Zealand Limited Financial

More information

A Guide To DEFINED FOCUSED DISCIPLINED

A Guide To DEFINED FOCUSED DISCIPLINED A Guide To F I R S T T R U S T U N I T I N V E S T M E N T T R U S T S DEFINED FOCUSED DISCIPLINED W H A T I S A U N I T I N V E S T M E N T T R U S T? U I T F E A T U R E S A unit investment trust or

More information

ETF Options. Presented by The Options Industry Council 1-888-OPTIONS

ETF Options. Presented by The Options Industry Council 1-888-OPTIONS ETF Options Presented by The Options Industry Council 1-888-OPTIONS ETF Options Options involve risks and are not suitable for everyone. Prior to buying or selling options, an investor must receive a copy

More information

optionsxpress Australia Pty Limited Exchange Traded Options

optionsxpress Australia Pty Limited Exchange Traded Options Part 1 Incorporating Part 2 - Schedule of Fees and Costs Issued by: ABN: 11 085 258 822 Australian Financial Services Licence No. 246743 Address: Unit 5, 4 Skyline Place Frenchs Forest NSW 2086 Phone:

More information

jbwere exchange traded options

jbwere exchange traded options jbwere exchange traded options Product Disclosure Statement (PDS) Preparation date: 25 February 2014 Issued by: WealthHub Securities Limited This PDS was prepared by: WealthHub Securities Limited, ABN

More information

Definition. Market. Volatility levels allocated by the Issuer. Volatility Levels allocated by JSE

Definition. Market. Volatility levels allocated by the Issuer. Volatility Levels allocated by JSE Warrants Definition A warrant is a geared financial instrument which gives the warrant holder the right but not the obligation to buy, sell or participate in the performance of the underlying security,

More information

Introduction to Index Futures and Options

Introduction to Index Futures and Options Introduction to Index Futures and Options Disclaimer of Liability Information provided is for educational purposes and does not constitute financial product advice. You should obtain independent advice

More information

Powerful tools for investing, speculating or hedging

Powerful tools for investing, speculating or hedging Powerful tools for investing, speculating or hedging DERIVATIVE MARKET Equity Derivatives Single Stock Futures www.jse.co.za Johannesburg Stock Exchange Single Stock Futures are powerful tools for investing,

More information

Everything You Need to Know About CFDs

Everything You Need to Know About CFDs Everything You Need to Know About CFDs Contracts for Difference, or CFDs, have been used for more than 20 years, but did not become popular with retail traders until after 2000. Essentially, a CFD is a

More information

LEAPS LONG-TERM EQUITY ANTICIPATION SECURITIES

LEAPS LONG-TERM EQUITY ANTICIPATION SECURITIES LEAPS LONG-TERM EQUITY ANTICIPATION SECURITIES The Options Industry Council (OIC) is a non-profit association created to educate the investing public and brokers about the benefits and risks of exchange-traded

More information

Exchange-Traded Funds

Exchange-Traded Funds Exchange-Traded Funds Exchange Traded Funds (ETF s) are becoming popular investment vehicles for many investors. Most ETF s are cost effective, broad market funds. We have put together a layman s explanation

More information

2008 Special Risks in Securities Trading

2008 Special Risks in Securities Trading 2008 Special Risks in Securities Trading Should you have any suggestions with regard to future editions of this information brochure, please send them to: office@sba.ch. We are interested in your feedback,

More information

RISK DISCLOSURE STATEMENT

RISK DISCLOSURE STATEMENT RISK DISCLOSURE STATEMENT You should note that there are significant risks inherent in investing in certain financial instruments and in certain markets. Investment in derivatives, futures, options and

More information

CONTRACTS FOR DIFFERENCE

CONTRACTS FOR DIFFERENCE CLIENT SERVICE AGREEMENT Halifax New Zealand Limited Client Service Agreement Product Disclosure Statement for CONTRACTS FOR DIFFERENCE Halifax New Zealand Limited Financial Services Provider No. 146605

More information

Understanding Options Trading. ASX. The Australian Sharemarket

Understanding Options Trading. ASX. The Australian Sharemarket Understanding Options Trading ASX. The Australian Sharemarket Disclaimer of Liability Information provided is for educational purposes and does not constitute financial product advice. You should obtain

More information

Introduction to Equity Derivatives on Nasdaq Dubai NOT TO BE DISTRIUTED TO THIRD PARTIES WITHOUT NASDAQ DUBAI S WRITTEN CONSENT

Introduction to Equity Derivatives on Nasdaq Dubai NOT TO BE DISTRIUTED TO THIRD PARTIES WITHOUT NASDAQ DUBAI S WRITTEN CONSENT Introduction to Equity Derivatives on Nasdaq Dubai NOT TO BE DISTRIUTED TO THIRD PARTIES WITHOUT NASDAQ DUBAI S WRITTEN CONSENT CONTENTS An Exchange with Credentials (Page 3) Introduction to Derivatives»

More information

Asset allocation A key component of a successful investment strategy

Asset allocation A key component of a successful investment strategy Asset allocation A key component of a successful investment strategy This guide has been produced for educational purposes only and should not be regarded as a substitute for investment advice. Vanguard

More information

PRINCIPAL GLOBAL INVESTORS FUNDS. Supplement dated 31 July 2013. for the Long/Short Global Opportunities Equity Fund

PRINCIPAL GLOBAL INVESTORS FUNDS. Supplement dated 31 July 2013. for the Long/Short Global Opportunities Equity Fund PRINCIPAL GLOBAL INVESTORS FUNDS Supplement dated 31 July 2013 for the Long/Short Global Opportunities Equity Fund This Supplement contains specific information in relation to the Long/Short Global Opportunities

More information

Margin FX and CFDs Product Disclosure Statement 26 June 2015

Margin FX and CFDs Product Disclosure Statement 26 June 2015 Margin FX and CFDs 26 June 2015 Issuer: Forex Capital Trading Pty Ltd AFSL No. 306400 and ABN 69 119 086 270 1 P a g e 1. Important Information 1.1 About this PDS This PDS is issued by Forex Capital Trading

More information

PRECISION TOOLS FOR PROFESSIONAL INVESTORS. Listed structured products

PRECISION TOOLS FOR PROFESSIONAL INVESTORS. Listed structured products PRECISION TOOLS FOR PROFESSIONAL INVESTORS Listed structured products Contents 2 Introduction 4 Trackers 6 Accelerated Trackers 8 Reverse Trackers 1 Bonus Trackers 12 Discount Trackers 14 Capital Protected

More information

Understanding Options Trading. ASX. The Australian Sharemarket

Understanding Options Trading. ASX. The Australian Sharemarket Understanding Options Trading ASX. The Australian Sharemarket Disclaimer of Liability Information provided is for educational purposes and does not constitute financial product advice. You should obtain

More information

PRODUCT KEY FACTS Samsung TOPIX Daily (2x) Leveraged Product

PRODUCT KEY FACTS Samsung TOPIX Daily (2x) Leveraged Product Issuer: Samsung Asset Management (Hong Kong) Limited 三 星 資 產 運 用 ( 香 港 ) 有 限 公 司 PRODUCT KEY FACTS Samsung TOPIX Daily (2x) Leveraged Product 24 June 2016 This is a leveraged product. It is different from

More information

The Options Clearing Corporation

The Options Clearing Corporation PROSPECTUS M The Options Clearing Corporation PUT AND CALL OPTIONS This prospectus pertains to put and call security options ( Options ) issued by The Options Clearing Corporation ( OCC ). Certain types

More information

PowerShares Smart Beta Income Portfolio 2016-1 PowerShares Smart Beta Growth & Income Portfolio 2016-1 PowerShares Smart Beta Growth Portfolio 2016-1

PowerShares Smart Beta Income Portfolio 2016-1 PowerShares Smart Beta Growth & Income Portfolio 2016-1 PowerShares Smart Beta Growth Portfolio 2016-1 PowerShares Smart Beta Income Portfolio 2016-1 PowerShares Smart Beta Growth & Income Portfolio 2016-1 PowerShares Smart Beta Growth Portfolio 2016-1 The unit investment trusts named above (the Portfolios

More information

INTRODUCTION TO OPTIONS MARKETS QUESTIONS

INTRODUCTION TO OPTIONS MARKETS QUESTIONS INTRODUCTION TO OPTIONS MARKETS QUESTIONS 1. What is the difference between a put option and a call option? 2. What is the difference between an American option and a European option? 3. Why does an option

More information

Margin FX and CFDs Product Disclosure Statement 26 April 2016

Margin FX and CFDs Product Disclosure Statement 26 April 2016 Margin FX and CFDs 26 April 2016 Issuer: Forex Capital Trading Pty Ltd AFSL No. 306400 and ABN 69 119 086 270 1 P a g e 1. Important Information 1.1 About this PDS This PDS is issued by Forex Capital Trading

More information

Frequently Asked Questions on Derivatives Trading At NSE

Frequently Asked Questions on Derivatives Trading At NSE Frequently Asked Questions on Derivatives Trading At NSE NATIONAL STOCK EXCHANGE OF INDIA LIMITED QUESTIONS & ANSWERS 1. What are derivatives? Derivatives, such as futures or options, are financial contracts

More information

INITIAL PUBLIC OFFERINGS

INITIAL PUBLIC OFFERINGS EQUITIES Main Board GEM EQUITIES Equity securities, generally referred to as shares or stocks, represent ownership units in the issuing company. In Hong Kong, shares are listed either on the Main Board

More information

Plus500AU Pty Ltd. Product Disclosure Statement

Plus500AU Pty Ltd. Product Disclosure Statement Plus500AU Pty Ltd Product Disclosure Statement Product Disclosure Statement Our Contact Details Issuer: PLUS500AU Pty Ltd ACN 153 301 681 Address: Level 19, 1 O Connell Street Sydney NSW 2000 Australia

More information

Derivative Users Traders of derivatives can be categorized as hedgers, speculators, or arbitrageurs.

Derivative Users Traders of derivatives can be categorized as hedgers, speculators, or arbitrageurs. OPTIONS THEORY Introduction The Financial Manager must be knowledgeable about derivatives in order to manage the price risk inherent in financial transactions. Price risk refers to the possibility of loss

More information

SLVO Silver Shares Covered Call ETN

SLVO Silver Shares Covered Call ETN Filed pursuant to Rule 433 Registration Statement No. 333-180300-03 April 15, 2014 SLVO Silver Shares Covered Call ETN Credit Suisse AG, Investor Solutions April 2014 Executive Summary Credit Suisse Silver

More information

Module 5 Index CFDs. Course #: Title. Version 1 August 2013 1

Module 5 Index CFDs. Course #: Title. Version 1 August 2013 1 Module 5 Index CFDs Course #: Title Topic 1: S&P/ASX 200 CFDs... 3 Initial margin... 3 Variation margins... 3 Cashflows... 4 Topic 2: S&P/ASX 200 CFD strategies... 6 Trade broad market movements... 6 Protect

More information

SOCIETE GENERALE STRUCTURED PRODUCTS

SOCIETE GENERALE STRUCTURED PRODUCTS SOCIETE GENERALE STRUCTURED PRODUCTS Ben Thompson, Societe Generale Listed Products Thursday 31 st January 2013 RISK WARNING The following products are suitable for sophisticated retail and professional

More information

Macquarie Contracts for Difference

Macquarie Contracts for Difference Macquarie Contracts for Difference Product Disclosure Statement 15 JUNE 2015 Macquarie Bank Limited. ABN 46 008 583 542. Australian Financial Services Licence No. 237502. 1 This PDS This product disclosure

More information

PROSHARES ULTRA GOLD MINERS

PROSHARES ULTRA GOLD MINERS SUMMARY PROSPECTUS OCTOBER 1, 2015 GDXX PROSHARES ULTRA GOLD MINERS GDXX LISTED ON NYSE ARCA This Summary Prospectus is designed to provide investors with key fund information in a clear and concise format.

More information

POLICY STATEMENT Q-22

POLICY STATEMENT Q-22 POLICY STATEMENT Q-22 DISCLOSURE DOCUMENT FOR COMMODITY FUTURES CONTRACTS, FOR OPTIONS TRADED ON A RECOGNIZED MARKET AND FOR EXCHANGE-TRADED COMMODITY FUTURES OPTIONS 1. In the case of commodity futures

More information

ADVISORSHARES TRUST. AdvisorShares Pacific Asset Enhanced Floating Rate ETF NYSE Arca Ticker: FLRT

ADVISORSHARES TRUST. AdvisorShares Pacific Asset Enhanced Floating Rate ETF NYSE Arca Ticker: FLRT ADVISORSHARES TRUST AdvisorShares Pacific Asset Enhanced Floating Rate ETF NYSE Arca Ticker: FLRT Supplement dated February 26, 2016 to the Summary Prospectus, Prospectus, and Statement of Additional Information

More information

CONTRACTS FOR DIFFERENCE

CONTRACTS FOR DIFFERENCE PRODUCT DISCLOSURE STATEMENT CONTRACTS FOR DIFFERENCE Halifax Investment Services Limited Australian Financial Services Licence No. 225973 Date 20th October 2014 HALIFAX Product Disclosure Statement 1

More information

General Risk Disclosure

General Risk Disclosure General Risk Disclosure Colmex Pro Ltd (hereinafter called the Company ) is an Investment Firm regulated by the Cyprus Securities and Exchange Commission (license number 123/10). This notice is provided

More information

OANDA AUSTRALIA PTY LTD PRODUCT DISCLOSURE STATEMENT

OANDA AUSTRALIA PTY LTD PRODUCT DISCLOSURE STATEMENT OANDA AUSTRALIA PTY LTD PRODUCT DISCLOSURE STATEMENT Issue Date: 1 August 2014 OANDA Australia Pty Ltd ACN 152 088 349 AFSL 412981 OANDA Australia Pty Ltd ACN 152 088 349 AFSL 412981 1 Table of Contents

More information