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New HSI Warrants Listing Today
27 Aug 08

Macquarie is pleased to list the following new warrants to cover any further downside movement in Hang Seng futures index:

HSI18400MBLePW081030(GH8W), exercise 18,400, 500 warrants per share.*

HSI19800MBLeCW081030(GH9W), exercise 19,800, 500 warrants per share.*

Meanwhile, the following warrants have the closest strikes to the Hang Seng futures’ closing level of 21,086 yesterday:

HSI21200MBLeCW081030(GE1W), exercise 21,200, 500 warrants per share *

HSI20800MBLePW081030(GD6W), exercise 20,800, 500 warrants per share *

500 warrants per share imply that you need to purchase 500 warrants to entitle you to 1 underlying share.

Warrant Education
How to derive settlement value of HSI warrants
The settlement value for HSI warrants differs slightly from that for single stock warrants, which was previously discussed in an earlier issue. Similar to single stock warrants, an HSI call warrant will only have value at expiry and be deemed ‘in the money’ if the closing HSI level is above its exercise level while the closing HSI level must be below the exercise level for a put warrant. As with all structured warrants in Singapore, the last trading date will be four business days before expiry.


Mon

Tues

Wed

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Sun

1

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7

 

 

Last day of Trading

 

Warrant stops trading

 

 

 

 

8

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Expiry Date

 

 

 

 

 

 

 

There is however an important difference – the closing HSI level is NOT taken to be the average of its closing levels over five days but rather, the announced closing level of the HSI futures contract expiring in the relevant month.

For instance, the closing level of the October futures contracts on 30 October will be used to calculate HSI warrants expiring that month.

Calculation of HSI warrant upon expiry
Call Warrant Settlement amount = (Closing level - Strike Price) / Warrants per share
x Exchange Rate

Put Warrant Settlement amount = (Strike Price - Closing Level) / Warrants per share
x Exchange Rate

Example:
Take for instance, the Hang Seng Exchange announces the settlement level of the HSI October futures to be 22,800 on 30 October 08 (after market hours), whilst the HKD/SGD exchange rate is at 0.183. The following warrant HSI19800MBLeCW081030 (GH9W), exercise 19,800, 500 warrants per sharewill then expire with the below value:

(22,800 – 19,800) / 500 x 0.183 = $1.098 per warrant

This amount multiplied by the number of warrants you hold will be the amount you will be entitled to receive at expiry (less a small admin fee of $20 per warrant holder).

For a full list of warrants with their different paramaters including free LIVE pricing, please log on to www.warrants.com.sg

 

This internet site is produced by Macquarie Capital Securities (Singapore) Pte. Limited (Registration No 198702912C) (“MCSSPL”), holder of a capital markets services licence under the Securities and Futures Act, Chapter 289 of Singapore.  No part of this internet site may be copied, either in whole or in part, or distributed to any other person.  If you are not the intended recipient you must not use or disclose the information in any way.

The information on this internet is directed and available for general circulation to residents of Singapore only and is not provided to any person who is a resident of the United States or any other country.  Any material provided herein, including any indicative terms are provided for information purposes only and do not constitute an offer, a solicitation of an offer, or any advice or recommendation to conclude any transaction.  While MCSSPL provides the information in good faith and derived from sources believed to be reliable, MCSSPL does not represent or warrant the completeness, reliability, accuracy, timeliness or fitness for any purpose of any of the material and it accepts no responsibility for the accuracy, completeness or timeliness of the information.

Macquarie Bank Limited (ABN 46 008 583 542) (“MBL”) is the Issuer of the Macquarie Warrants (“Warrants”).  References to Macquarie include MBL and MCSSPL.  MBL does not carry on banking business in Singapore.  MBL does not hold a licence under the Banking Act, Chapter 19 of Singapore and therefore is not subject to the supervision of the Monetary Authority of Singapore in respect thereof.  MCSSPL is not an authorised deposit taking institution for the purposes of the Banking Act 1959 (Commonwealth of Australia), and MCSSPL's obligations do not represent deposits or other liabilities of MBL.  MBL does not guarantee or otherwise provide assurance in respect of the obligations of MCSSPL. 

Disclosures with respect to the listed companies, if any, mentioned in this document are available at www.macquarie.com.au/research/disclosures.
 
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