Warrants

Equity warrants

What are Equity warrants?

Warrants are available in both calls and puts, allowing investors to take advantage of Positive and Negative movements in an underlying share. Depending on the type of warrant traded, the investor has the right but not the obligation to either buy or sell an underlying share at a specific rate (known as the strike price) on a specific date (known as the expiry or maturity date). Taking up this right is known as "exercising the warrant". However, warrants can be traded without the need to exercise the underlying share, thereby making them ideal as short-term trading instruments.

Why trade Equity warrants?

• Geared/Leveraged exposure to an underlying share. 
• To benefit from fluctuations in the price of an underlying share.
• To hedge against adverse movements of a share price.
• Ability to trade both the long and short sides of the market.
• There is no securities transfer tax payable.
• No margining process applies; therefore no daily settlement of profits and losses takes place.
• Liquidity provided by Standard Bank, ensuring that traders are able to efficiently enter and exit positions.
• Open up a warrants trading account through online share trading and you will be able to trade warrants and share instalments at a flat brokerage rate of R60*
  
  * Excludes VAT, UST and investor protection levy. 

 

Read more

Brochure
Download our informative brochure on Equity warrants to learn more about this exciting product.

 

Courses available

Face-to-face courses
We offer an intermediate level half-day derivatives course.

Existing clients can log into the platform to check course details, upcoming dates in your city and to make a booking.

New clients please phone our call centre for further information.

 

Start trading

New clients: Click here to register now with Standard Online Share Trading.

Existing account holders: To trade shares, please:

1. Log-on
2. Click on the OTHER PRODUCTS menu
3. Select Equity warrants REGISTRATION.

What are warrants?

A warrant gives an investor the right – but not the obligation - to purchase (call) or sell (put) a predetermined asset (most often a share) at a predetermined price (strike/exercise) by a specified date (exercise) in the future.

In other words, one can benefit from rising and falling prices. Further warrants offer leverage that increases one’s risk and as such profit or loss.

It is possible to have more than one warrant on a particular underlying share. Call warrants allow traders to profit from share price increases, while put warrants let traders make money when the share price falls. For the risk-inclined investor, trading in warrants can provide the same type of upside associated with small cap shares without some of the pitfalls.
In South Africa, the Financial Services Board regulates warrants under the Stock Exchange Control Act.

 

Why trade warrants?

All investors should consider including a warrants component in their portfolio. These are some of their more pertinent benefits:

1. Warrants enable investors to trade on the JSE Limited with the same ease as trading ordinary shares
2. Warrants offer a low cost entry into blue chip shares
3. There is potential to leverage or gear up your investment
4. Your risk is limited to the initial premium (price of the warrant) paid
5. Warrants have the transparency of a listed instrument
6. Small investors can short the market or hedge their portfolios through the use of put warrants and so profit from falls in the market
7. The warrants market is extremely liquid, as the issuer is required to provide both bids and offers.
8. Warrants are an extremely cheap instrument to trade with no STT tax and brokerage of a flat R60 plus taxes and fees

 

Read more

Brochure
Download the brochure to learn more about trading warrants.

 

Courses available

Interactive online tutorial
Our flash-based interactive tutorial covers the sophisticated features of warrants and how to trade them. Click below to download.

Face-to-face courses
We offer an intermediate level half-day derivatives course.

Existing clients can log into the platform to check course details, upcoming dates in your city, and to make a booking.

New clients please phone our call centre for further information.

 

Start trading

If you would like to open a discount warrants and instalments account, please click here.

With our special warrants account, you can trade warrants, investment products or share instalments for a low flat brokerage rate of only R60 (plus applicable taxes and fees) - regardless of the size of your warrants deal. Trading normal shares in this account is not possible.

You will only be charged one monthly account maintenance fee, provided your accounts are linked to the same login.

New clients: Click here to register now with Standard Online Share Trading.
Existing account holders: To trade shares, please:

1. Log-on
2. Click on the OTHER PRODUCTS menu
3. Select WARRANTS REGISTRATION.

Index Warrants

What are Index warrants?

Warrants are available in both calls and puts, allowing investors to take advantage of Positive and Negative movements in an underlying index. Depending on the type of warrant traded, the investor has the right but not the obligation to either buy or sell the performance of an underlying index at a specific rate (known as the strike price) on a specific date (known as the expiry or maturity date).  Taking up this right is known as “exercising the warrant”. However, warrants can be traded without the need to exercise the underlying share, thereby making them ideal as short-term trading instruments.  Index warrants are cash settled meaning that no physical delivery of shares take place.

Why trade Index warrants?

• Geared/Leveraged exposure to an underlying share. 
• Geared/Leveraged exposure to an underlying index. 
• To benefit from fluctuations in the price of an underlying index.
• To hedge against adverse movements of a index allowing you to hedge an entire portfolio of shares.
• Ability to trade both the long and short sides of the market.
• There is no securities transfer tax payable.
• No margining process applies; therefore no daily settlement of profits and losses takes place.
• Liquidity provided by Standard Bank, ensuring that traders are able to efficiently enter and exit positions.
• Open up a warrants trading account through online share trading and you will be able to trade warrants and share instalments at a flat brokerage rate of R60*

• * Excludes VAT, UST and investor protection levy. 

 

Courses available

Face-to-face courses
We offer an intermediate level half-day derivatives course.

Existing clients can log into the platform to check course details, upcoming dates in your city and to make a booking.

New clients please phone our call centre for further information.

 

Start trading

New clients: Click here to register now with Standard Online Share Trading.
Existing account holders: To trade shares, please:

1. Log-on
2. Click on the OTHER PRODUCTS menu
3. Select INDEX WARRANTS REGISTRATION.

Currency reference warrants (CRWs)

What are CRWs?

1. A currency reference warrant (CRW) is a derivative – its value is derived from another underlying asset, in this case an exchange rate.
2. More specifically, its value is based on the change in the rand price of one unit of a specified foreign currency.

CRWs are available in both calls and puts, allowing investors to take advantage of your view of the future direction of the South African Rand against a number of different currency crosses. Depending on the type of warrant traded, the investor has the right - but not the obligation - to either buy or sell the performance of the rand against a specified foreign currency (for example, the US Dollar) at a specific rate (strike price) on a specific date (expiry or maturity date).

A CRW’s intrinsic value is determined from the difference between the underlying exchange rate and the strike price. It is the amount that the warrant is worth if it had to expire on that day. If the CRW does not have any intrinsic value at maturity, the loss incurred is the initial amount invested (the premium).

CRWs are cash settled in South African Rand which means that no transfer or settlement of foreign currency occurs. CRWs trade in a liquid secondary market where investors may enter or exit their warrant positions with ease.
CRWs are ideal for investors who understand the product and the risks associated with its gearing.

 

Why trade CRWs?

CRWs are listed on the JSE Limited, which enables investors to trade currency as an asset class and thereby take advantage of either a positive or negative view of the future direction of the South African Rand against other major currencies.
The specific benefits of trading CRWs include:

1. Benefitting from currency fluctuations
2. Taking advantage of your view of where the rand will be trading against a foreign currency (for example, the US Dollar) in the future
3. Diversifying your portfolio by adding currency exposure
4. Hedging against adverse movements in the rand
5. Trading with liquidity provided by Standard Bank
6. Leveraging or gearing your exposure to an underlying exchange rate.

In addition, CRWs do not incur Securities Transfer Tax (STT) and no margining process applies (as with trading currency futures). Therefore no daily settlement of profits and losses takes place.

 

Read more

Brochure
Download our informative brochure on currency reference warrants to learn more about this exciting product.

 

Courses available

Face-to-face courses
We offer an intermediate level half-day derivatives course.

Existing clients can log into the platform to check course details, upcoming dates in your city and to make a booking.

New clients please phone our call centre for further information.

 

Start trading

New clients: Click here to register now with Standard Online Share Trading.
Existing account holders: To trade shares, please:

1. Log-on
2. Click on the OTHER PRODUCTS menu
3. Select CRW REGISTRATION.

Knockout warrants

What are Knockout warrants?

With the growing popularity of geared trading instruments in South Africa, Standard Bank launches Knockout! Warrants, a super-charged warrant for experienced traders.  Knockout! Warrants are warrants listed over individual indices or shares traded on the Johannesburg Stock Exchange. Investors can trade them in the same manner as vanilla warrants.  Knockout! Warrants have a Knockout Level. This Knockout Level is equivalent to the Strike Price. If the price of the underlying crosses the Knockout Level (Strike Price), the warrant lapses, that is, it terminates and gives the holder no further rights.

 

Why trade Knockout warrants?

• Geared/Leveraged exposure to an underlying index or share.
• Liquidity provided by Standard Bank, ensuring that traders are able to efficiently enter and exit positions.
• Ability to trade both the long and short sides of the market.
• Knockout Level provides traders’ protection from unlimited losses, that is, your maximum potential loss is your initial premium paid – be aware that this is still a 100% loss on your investment.
• Delta 1 Exposure, allows traders to replicate the index’s performance on an almost one-for-one basis.
• Open up a warrants trading account through online share trading and you will be able to trade warrants and share instalments at a flat brokerage rate of R60*

* Excludes VAT, UST and investor protection levy. 

 

Read more

Brochure
Download our informative brochure on currency reference warrants to learn more about this exciting product.

 

Available courses

Face-to-face courses
We offer an intermediate level half-day derivatives course.



Existing clients can log into the platform to check course details, upcoming dates in your city and to make a booking.

New clients please phone our call centre for further information.

 

Start trading

New clients: Click here to register now with Standard Online Share Trading.
Existing account holders: To trade shares, please:

1. Log-on
2. Click on the OTHER PRODUCTS menu
3. Select CRW REGISTRATION.

Commodity reference warrants

What are commodity reference warrants

A commodity reference warrant (CoRW) is a derivative – its value is derived from another underlying asset, in this case a Commodity (Gold, Platinum, Oil, etc). More specifically, its value is based on the change in the Rand price of the underlying Commodity (e.g. R7.50 x $1,000.00) 

CoRWs are available in both calls and puts, allowing investors to take advantage of Positive and Negative movements in the Rand value of the underlying commodity. Depending on the type of warrant traded, the investor has the right but not the obligation to either buy or sell the performance of the Rand value of the underlying commodity (e.g. the Rand Value of the Gold Price) at a specific Rand value (known as the strike price) on a specific date (known as the expiry or maturity date).

Why trade commodity reference warrants

• To benefit from fluctuations in the rand price of a commodity.
• To take advantage of your view of where the rand value of a specific commodity will be trading (e.g. the rand gold price) in the future.
• To diversify your portfolio by adding commodity exposure.
• To hedge against adverse movements in the rand commodity price.
• There is no securities transfer tax payable.
• No margining process applies; therefore no daily settlement of profits and losses takes place.
• Liquidity provided by Standard Bank, ensuring that traders are able to efficiently enter and exit positions.
• Geared/Leveraged exposure to an underlying rand-denominated commodity price.
• Open up a warrants trading account through online share trading and you will be able to trade warrants and share instalments at a flat brokerage rate of R60*

  * Excludes VAT, UST and investor protection levy. 

 

Read more

Brochure
Download our informative brochure on Equity warrants to learn more about this exciting product.

 

Courses available

Face-to-face courses
We offer an intermediate level half-day derivatives course.



Existing clients can log into the platform to check course details, upcoming dates in your city and to make a booking.

New clients please phone our call centre for further information.

 

Start trading

New clients: Click here to register now with Standard Online Share Trading.
Existing account holders: To trade shares, please:

1. Log-on
2. Click on the OTHER PRODUCTS menu
3. Select INDEX WARRANTS REGISTRATION.