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Investment Warrants are issued by third-party financial institutions that allow investors to gain exposure to the capital movements, as well as be entitled to ordinary dividends of the underlying share over the life of the warrant. Effectively, investors can buy shares in 2 payments by making a part payment upfront and delaying an optional final payment until a later date.
Generally, Investment Warrants tend to have longer expiry dates, lower holding costs, lower risk profile and often have a higher face value than traditional Warrants.
You can derive a regular income stream through the entitlement to the ordinary dividends of the underlying share for less capital outlay.
- Unlock capital from your existing shareholdings
Investment warrants are a convenient alternative to release capital from your portfolio. You can convert your shares into Investment warrants while maintaining exposure to your existing shares. This can be an ideal way to spread risk and build a wider asset base.
You can increase your exposure to shares by accessing margin financing on a transparent listed platform, without the risk of margin calls.
You have the option to exercise and take delivery of the fully paid shares at expiry or to cash settle.
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The underlying asset fails to perform as per your expectations.
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When investing in Investment Warrants, the maximum amount at risk is your initial investment (plus transaction costs). You are not exposed to the risks of margin calls.
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Investment Warrants offer a leveraged exposure to the underlying share, therefore percentage profits and losses are magnified.
Investment Warrants is represented by the denotation “i” in the trading name of structured warrants. To learn how to interpret the trading name of structured warrants, click here.
Issuer |
Product Information |
Macquarie Bank |
Click here |
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What is an Investment Warrant?