Enjoy up to S$50 Commission Rebates for your DLC Trades!
Terms and Conditions:
1. Eligible Clients (as defined in paragraph 3) may qualify to receive rebates on the commissions levied for trades on Daily Leverage Certificates (“DLC Trades”) executed between the period of 28 September 2020 to 31 December 2020 , both dates inclusive (“Promotion Period”) (collectively the “S$50 Commission Rebates for DLC Trades Promotion” or “Promotion”).
2. Subject to the terms and conditions contained herein, an Eligible Client is entitled to a maximum rebate of S$50, regardless of the number of DLC Trades executed by the Eligible Client during the Promotion Period (the “Rebate”). The Rebate will not be subject to GST and other fees and charges.For the avoidance of doubt, GST and other fees and charges are still payable by an Eligible Client, regardless of whether he/she qualifies for the Rebate.
3. The Promotion is open to new and existing clients of Maybank Kim Eng Securities (“Maybank KES”) with a valid Cash, Prefunded or Margin account, who execute at least one (1) DLC Trade in any of their Maybank KES account(s) during the Promotion Period provided they have also not executed any DLC Trades in any of their Maybank KES account(s) prior to the Promotion Period (“Eligible Clients”, each an “Eligible Client”).
4. The Promotion is applicable to online/mobile/offline DLC Trades executed via the Eligible Client's Maybank KES Cash, Prefunded or Margin account.
5. Where an Eligible Client qualifies for the Rebate, the Rebate shall be paid into the applicable trading account of the Eligible Client in one lump sum within two (2) months following the end of the Promotion Period.
Click here to view the full terms and conditions.
NOTE: Daily Leverage Certificates (DLCs) will be available for trading as of Monday 17 July, 9AM.
Daily Leverage Certificates (DLCs) are financial instruments that replicate the underlying index linearly with a constant leverage effect (e.g. x3 or x5), and is issued under the Structured Warrants Framework. DLCs are classified as high risk and high complexity products. Retail investors are required to be Specified Investment Products (SIPs) qualified in order to trade DLCs.
1) Easy to Understand
Daily Leverage Certificates (DLCs) performance can be simply calculated by
Underlying index performance
Leverage factor applied
Cost & fess deducted
Unlike other instruments like Structured Warrants, DLCs track the performance of its underlying index linearly and does not change due to time, expiry of the contract, change in volatility of the underlying index etc.
2) Go Long or Go Short With Leverage
Daily Leverage Certificates (DLCs) amplifies returns, in both rising and falling markets.
3) Limited Losses
Losses incurred on DLC positions are limited to the initial capital invested.
4) Compounded Returns
DLCs are structured based on the daily performance of their underlying index, and are as such intended to be traded intraday. The price performance of the underlying index and DLC are reset at the end of each trading day. This means that the performances each day are locked in and subsequent returns are based on what was achieved the day before. This process is referred to as compounding.
5) Air Bag Mechanism
The Air Bag mechanism is designed to slow down the rate of loss on the index during extreme market conditions. The Air Bag comes into effect at a predetermined drop in the underlying index. This level varies depending on the leverage ratio, as well as the nature of the underlying index. If this occurs, the Air Bag triggers an intraday re-set of the underlying index. The reset takes place over a period of 30mins. Following the reset, the performance of the underlying index is based on the new observed level. This is designed to reduce the impact of any subsequent fall.
The Air Bag Mechanism will reduce the impact if the index falls, but will also maintain a reduced exposure to the index in the event the index starts to rise after the Air Bag Mechanism is triggered, thereby reducing its ability to recoup losses.
Who Can Trade DLCs?
DLCs are designed for active investors who have financial knowledge and experience in trading leverage products and willing to take higher risk. It is designed for sophisticated investors who are looking for the potential to make enhanced returns from the daily benchmark indices.
All investors need to be SIP qualified with full understanding on the products in order to trade DLCs.
How Does One Trade DLCs?
You can trade DLCs the same way you buy and sell shares and other securities listed on SGX-ST. Simply execute the trades through your broker. No separate account is needed for the trading of different securities. Trades are settled on the same basis as share transactions - on the third business day after the trade date.
Please click here for more information on Daily Leverage Certificates.
Leverage is a "double-edged" sword. In addition to magnifying gains, DLCs can also magnify losses when the value of the underlying index moves against the DLCs position. For instance, a fall in the price of the underlying index can lead to a larger percentage loss in the value of the long DLCs.
In the event that a DLC or underlying index is denominated in a currency other than SGD, you will be subject to exchange rate fluctuations that may have an adverse effect on the value, price or return of the DLC.
Similar to other investments in the securities market, the market value of a DLC is susceptible to events that affect its demand and supply. Hence, the market value of your investment will fluctuate accordingly.
Liquidity risk occurs when a warrant holder is unable to sell his DLCs for a reasonable price in the market. This is due to insufficient buy orders, which affects the market price of the DLCs.