FOR the first time in Malaysia, Macquarie Warrants is issuing call and put warrants over the Hang Seng TECH Index (HSTECH), Hong Kong’s new flagship index that tracks the largest technology companies listed in Hong Kong.
The structured warrants starts its maiden day trading on Bursa Malaysia t0day (March 9).
With the introduction of the HSTECH warrants, investors have the opportunity to gain exposure to leading technology companies which have grown increasingly dominant in the global marketplace.
HSTECH is an index that tracks the performance of the largest technology stocks in the Hong Kong market including Alibaba, Tencent, Meituan and Xiaomi, which have a combined weight of more than 30% and contribute an average of 18% to the Hang Seng Index’s (HSI) daily turnover.
“The launch of the HSTECH warrants comes at an opportune time for Malaysian investors as technology companies are leading the global equity markets rally and investor demand for Chinese technology companies has been increasing rapidly,” Macquarie Commodities and Global Markets head of listed product distribution (Asia) Dean Herbert pointed out.
“With the high turnover and volatility of tech shares in Hong Kong market, we expect a high level of interest from retail investors in trading the HSTECH warrants in Malaysia.”
With the issuance of both call and put warrants, investors are able to leverage their market views with a lower capital outlay.
Call warrants move in line with the underlying – increasing in value – as the underlying increases, while put warrants move in an opposite direction to the underlying – increasing in value as the underlying decreases – thus allowing bullish and bearish investors to potentially profit from market moves.
The two new calls, HSTECH-C1 and HSTECH-C2, and the 2 new puts, HSTECH-H1 and HSTECH-H2, have different strike levels, catering for investors with various risk appetites and views on the technology sector.
Adding to their suite of warrants over foreign indices such as the S&P500, iShares China A50 ETF, and the Hang Seng Index, the HSTECH warrants will track the movement in the relevant HSTECH futures with the market making hours between 9.15am to 11.58am and 2.30pm to 4.28pm.
Investors can trade structured warrants with their existing CDS and trading account maintained with their brokers, similar to how they trade shares. – March 9, 2021
