|06 October 2017|
|Leveraged Products Reached Turnover Record in September|
Revival of Singapore Leveraged Products market
Volumes in SGX listed Structured Warrants had been in decline since their peak in 2007. As has been shared via this medium many times, we have seen a reversal since Q1 2016 where warrant volumes sowed a positive trend again. Due to the launch of a new product class – Daily Leverage Certificates (DLCs) which are our new first-in-Asia products on SGX – a new turnover record was reached in September of SGD 1.9 billion or SGD 96 million traded on average per day.
The daily average turnover of leveraged products accounted for 8.8% of the overall Singapore securities market daily average in September 2017.
August and Sept have seen higher volatility in the HSI resulting in higher trading activity in especially the SGX listed HSI Structured Warrants. Majority of turnover was generated in Macquarie warrants. Other active issuers are UBS, Vontobel and JP Morgan.
Daily Leverage Certificates
SGX launched DLCs in mid-July this year, attracting new traders to our market, generating additional turnover (SGD 758 million in Sept). Wednesday 4 October actually showed one of the largest daily moves for a 5x DLC since the launch, the HSCEI 5x Long was up 18.5%, showcasing the potential of DLCs. In September around 70% of DLC turnover was in SiMSCI DLCs (unlike Structured Warrants where majority in turnover typically is generated in HSI warrants). On 5 October, total turnover since launch on DLCs equalled SGD 1 billion, a major milestone for a newly introduced product.
DLCs have less complex product features compared to warrants and options, and therefore may suit a different audience. Broker & Investor feedback on the new product has been positive and together with them, the product issuer (SocGen) and SGX , we will be organizing more (educational) campaigns to generate more awareness and insights into possible trading strategies.
Overall DLCs traded more from Long perspective in September in total, however on an index level the HK indices are traded more from the long side , while SiMSCI is traded slightly more from the short side.
New 100% Singapore REITS ETF to be listed 30 October 2017 - Lion-Phillip S-REIT ETF
Lion Global Investors (LGI), together with Phillip Capital Management, will launch their new REITs ETF – the Lion-Phillip S-REIT ETF (Stock code: CLR; Bloomberg: SREITS SP) – on SGX on 30th Oct 2017. The ETF tracks the Morningstar® Singapore REIT Yield Focus Index (MSDIRYPS Index), which comprises 23 Singapore REITs and has a trailing 12-month dividend yield of 5.75%
The launch of this ETF with a large focus on Singapore will help growth in the SGX S-REITs segment as it offers a sustainable income stream & portfolio diversification through exposure to the high-quality S-REITs at a low cost
The initial offer period for the Lion-Phillip S-REIT ETF runs from 2 October to 20 October 2017, and the issue price of each unit during the offer period is S$1
A retail seminar will be hosted by LGI to introduce the ETF “Lion-Phillip S-REIT ETF: Introducing a low-cost way to access high-quality S-REITs through one fund”. For more details, please click here.
More information on the ETF can be found here.
The SGX Structured Warrants Page includes tools like a calculator, charts and position builder. (click here)
You can also find out more about DLCs here.
Specified Investment Products
Structured warrants and Daily Leverage Certificates are examples of Specified Investment Products (SIPs). The MAS has introduced measures for intermediaries to safeguard the interests of individual investors investing in SIPs, which are products with features that might be more complex in nature. Investors now have the opportunity to assess their qualifications to trade SIP or enhance their product knowledge through the SGX online portal available here. Speak to your broker to find out how you can qualify to trade SIPs.
Education and Resources
SGX’s investor education portal with market, product and investment information and events. Sign up now at sgx.com/mygateway to receive our investment updates and economic calendar.
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