FPT gets covered warrants issued by 3 securities companies

It is expected that in June, 3 securities companies including SSI, VNDIRECT and MB will issue covered warrants (CW) for the stocks of FPT.

Some 26 stocks in the VN30-Index are qualified to be underlying stocks of covered warrants. They included FPT, REE, SSI, DPM, VIC, STB, EIB, SBT, HPG, MSN, MWG, CII, CTD, DHG, GMD, VHM, ROS, HDB, VRE, MBB, TCB, VNM, VJC, PNJ, VPB, NVL.

Such stocks meet requirements in terms of market capitalization of more than VND5 trillion, sufficient liquidity and a 20 per cent free-float share ratio of the total outstanding shares and decent business performance.

CW are officially introduced in 2017. Some securities companies were licensed to run the covered warrant market. SSI Securities Inc (SSI) will issue covered warrants that underline shares of Mobile FPT Corporation (HoSE: FPT), World Investment Corporation (HoSE: MWG), MBBank (MBB) and Hoa Phat Group (HPG). Securities companies which want to issue covered warrants must satisfy conditions related to financial capacity and be fully licensed securities operations.

Covered warrants are securities that have collateral assets issued by Securities Companies. The owner will have the right (not the obligation) to buy or sell the underlying stock at a predetermined price, before or at a specific time in the future.

The new product is expected to provide investors with more investment and hedge options, while helping draw foreign investment as there is no cap on foreign ownership of this product. Covered warrants are structured as a derivative and has leverage, low transaction cost, short life cycle, which is welcomed by individual investors due to its superiority of profitability and risk control.