Derivative News

SG WARRANT IN FOCUS

  • After falling by about 10% from its high of $11.12 last week, Keppel Corp recovered on Friday rising $0.36 to close at $10.50. The group’s Offshore & Marine’s order book now stands at a record $12.2bn. Investors who expect the share to recover further may want to consider its mid-term call E6QW.

  • Bank lending grew at the fastest rate in 12 years for the month of February 2008. It rose 22% compared to previous year with total loans outstanding amounting to $241bn. UOB will be a prime beneficiary of this strong growth. Its share rose $0.70 on Friday to $20.80. Investors who like the group may want to look at its newly listed call FO3W.

Warrant Name

Code

Type

Strike

Maturity

Effective Gearing

Implied Volatility

KepCorp SGA eCW080721

E6QW

Call

10.30

21/07/08

5.6 x

47.5%

UOB SGA eCW080908

FO3W

Call

21.40

08/09/08

4.9 x

48.0%


 

 

  • Since reaching its low of 20,572 in mid-March, the Hang Seng Index (“HSI") has been trending upwards largely due to the absence of adverse news from the US. Better than expected jobless rate claims in US also help to support investors’ sentiments. Investors who foresee the HSI to strengthen further may look at its call FL2W whilst those who hold a negative view may consider its put FK9W.

Warrant Name

Code

Type

Strike

Maturity

Effective Gearing

Implied Volatility

HSI23000 SGA eCW080529

FL2W

Call

23,000

29/05/08

6.4 x

51.5%

HSI22800 SGA ePW080529

FK9W

Put

22,800

29/05/08

7.5 x

51.5%

Source: SG and Bloomberg (11/04/08)
This information shall not be construed as an offer, invitation, advertisement, inducement or representation. The Société Générale Group assumes no responsibility or liability for any consequences, financial or otherwise, arising from this information. If a recommendation is made with respect to any warrant, please note that (1) the recommendation is intended for general circulation; (2) the recommendation does not take into account the specific investment objectives, financial situation or particular needs of any particular person; and (3) advice should be sought from a financial adviser regarding the suitability of the warrant, taking into account the specific investment objectives, financial situation or particular needs of any person in receipt of the recommendation before the person makes a commitment to purchase the warrant. The prices of warrants may rise or fall and the warrants may expire worthless, resulting in a total loss of investment. For the full disclaimer and terms and conditions of the warrants, please refer to the Base Listing Document and the relevant Supplemental Listing Documents, which can be downloaded from the website www.warrants.com.