Derivative Warrants (DW) are similar to options in that they have a fixed lifespan and returns are subject to a change in the underlying asset price. SCB Securities Co., Ltd. or SCBS (Broker No. 23) is the issuer of Derivative warrants to investors through the trading system of the Stock Exchange of Thailand. There are two types: Call Warrants (the right to purchase), and Put Warrants (the right to sell).
Derivative Warrants which are issued by SCBS can be bought and sold like a share at any point during market hours in normal market conditions. But, unlike stocks, DWs have a limited life. So Investors should trade DWs before it nears the expiry date. In addition, the value of the product depends on the value of the underlying, which may be volatile. If investors have a bullish market view, i.e. investors anticipate a rise in the underlying asset, select a Call Warrant. If it is a bearish view, i.e. investors anticipate a fall, select a Put Warrant. SCBS has made the Price Guideline, which announces the redemption price of the derivative warrants, relative to the price of the underlying stock. To help investors forecast return to make a decision before investing.
ü To increase the opportunity to amplify the potential return from higher gearing ratio.
ü To boost the overall return from rising and falling price of a single stock over a shorter time frame.
ü SCBS is the party providing prices for these products based on Price Guideline which shows up to 5 working days in advance.
Risks: Investing in Derivative warrants involves risks, including market risk and liquidity risks. Derivative warrants are leveraged instruments which mean gains and losses are amplified. In addition, derivative warrants have limited life spans and the value will decay over time. Investors are also exposed to counterparty risks like credit and default risks of the derivative warrant issuer. To manage the risks, investors should seek to understand the workings of such instrument and financial markets in general. To find out more, please contact our Investment Consultants.
SCBS Call Center
Tel: 0 2949 1999
Fax: 0 2949 1114