Products & platforms

Macquarie Trading Warrants

Diversify, protect or enhance your clients' exposure to a range of shares and indices

To request pricing, call 1800 080 033.

Features

Trading Warrants offer your clients short term exposure to an underlying asset (like a share, currency or index) by paying a portion of the underlying asset price upfront.

Since they were first listed by Macquarie Bank in 1991, Trading Warrants have become a very popular tool among investors and risk managers. Trading Warrants provide the opportunity to achieve leveraged returns, benefit from both a rising or falling market, diversify into a market or sector and/or protect the value of the underlying asset.

Key benefits

  • Increase your client's exposure to an underlying asset by paying a portion of the underlying asset price upfront.
  • Give you client the potential for greater returns (at a higher risk) than a direct investment in the underlying asset.
  • Access an opportunity to benefit from both increases (in the case of a Call Warrant) or decreases (in the case of a Put Warrant) in the value of the underlying asset.
  • No margin calls.

Types of Warrants

Macquarie offers a range of Trading Warrants, which vary according to the underlying asset to which the warrant is linked.

Type of Warrant Underlying asset Time frame Risk profile Uses
Equity ASX-listed shares Short term (Generally up to 6 months but may be up to 12 months) High Leveraged exposure or hedging
Index Linked to the performance of a share price index, such as the S&P/ASX 200. Short term (Generally up to 6 months but may be up to 12 months) High Leveraged exposure or hedging

How do they work?

Trading Warrants are similar to option contracts, except that they are typically issued by an investment bank like Macquarie Bank Limited (the issuer) and are quoted on the ASX. Trading Warrants provide underlying exposure to a share, asset or index. Each series of Trading Warrants may have a different structure and terms of issue.

In addition to providing exposure to different underlying assets, Trading Warrants may be either Call Warrants or Put Warrants.

Call Warrants

A Call Warrant gives the holder the ability to benefit from an increase in the value of the underlying reference asset above a nominated price (the exercise price) at a specific future date (the expiry date). The buyer of a Call Warrant will generally benefit from a rise in the underlying asset price, all other factors being equal.

Put Warrants

A Put Warrant gives the ability to benefit from a decrease in the value of the underlying reference asset below a nominated price (the exercise price) at a specific future date (the expiry date). The buyer of a Put Warrant will generally benefit from a decline in the underlying asset price, all other factors being equal. 

Trading Warrants investment cycle

Upfront During the investment At maturity
  • Choose your underlying asset (share, currency or index), and investment term.
  • Choose Warrants which reflect your view of the relevant underlying asset (ie bullish or bearish), risk profile and investment time frame.
  • Obtain the opportunity to benefit from:
    • a rise in the value of the underlying asset above a specified level at expiry(Call Warrants); or
    • a fall in the value of the underlying asset below a specified level at expiry (Put Warrants).
  • Obtain leveraged exposure by paying a portion of the underlying asset price upfront.
  • Your Trading Warrants will be listed on the ASX, so you may be able to sell them on the ASX.
  • Your Trading Warrants will be exposed to, among other things, the performance of the relevant underlying asset.
  • You may be entitled to receive an amount in cash calculated by reference to the amount by which the value of the underlying asset is above (in the case of a Call Warrant) or below (in the case of a Put Warrant) the Exercise Price of the Warrant.

How to invest

To invest in Macquarie Trading Warrants you or your client needs to:

Step 1 Contact Macquarie on 1800 803 010 or search for the Warrant at www.asx.com.au to obtain a copy of the Product Disclosure Statement (PDS) and any relevant supplementary PDS for the series of Warrants your client wishes to acquire.
Step 2 Your client must read the PDS and should check this website for any updated information about the Series of Warrants they wish to acquire.
Step 3 Your client needs to contact their financial adviser or stockbroker and organise for them to place an order to acquire the relevant Warrants on the ASX on their behalf.

Key risks

Some of the significant risks of investing in Macquarie Trading Warrants include:

  • the adverse performance of the relevant reference asset decreasing the value of your client’s investment
  • Trading Warrants often incorporate a high level of leverage (compared to a direct investment in the relevant reference asset) and in such circumstances should be considered a high risk investment
  • You and your client should also give careful consideration to the performance required of the relevant reference asset in order for your client to break even in relation to an investment in a Macquarie Trading Warrant.

An investment in Warrants does not suit investors seeking a traditional investment product (such as shares). You and your client should refer to the Product Disclosure Statement (PDS) for more information about some of the significant risks of investing in Macquarie Trading Warrants.

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Contact us

Call: 1800 080 033

Overseas: +61 2 8245 4903

Fax: +61 2 8232 6158