Bangkok--Nov 3--KGI
Ms.Naruemol Artamnuayvipas Vice President of Equity Derivatives at KGI said that the Securities Borrowing and Lending, or SBL, service will be available to private clients starting from this month.
Ms.Naruemol explained how the SBL service offers an alternative form of investment which means that KGI’s clients can benefit from both rising and falling market conditions. In traditional share trading investors buy stocks and then, later on, sell them. In SBL trading investors sell stocks and then, at a later date, buy them back. Securities which are on KGI’s short selling list can be borrowed for periods from 1 month up to 1 year, and in amounts of Bt 10million up.
KGI’s SBL service will also benefit the overall market by increasing liquidity and reducing volatility. All short-selling investors will have to buy-back the securities they sell so there will be no negative impact on the market. The borrowed securities can be sold through KGI’s Credit Balance accounts, using the SET’s Up-Tick rule. Under the Up-Tick rule, the securities sold short will only be sold at a price higher than the most recently executed price, whilst the marketing officer will apply the short-sell mark for both short-sale and buy-back transactions.
Ms Naruemol also said that clients will only have to deposit collateral of 80% of the value of the borrowed securities. The cash from the short sale will be credited to the client’s account and will earn interest at a competitive rate.
“The SBL service is expected to be very popular, especially for clients with large portfolios of investments, and KGI’s marketing officers are already well trained in the operation of SBL services” Ms.Naruemol said. KGI Securities Company was the first in Thailand to provide SBL service to institutional clients in 1999. Now retail clients have a chance to use the same trading tools that have already benefited professional fund managers.
Ms.Naruemol also revealed that KGI’s Equity Derivatives Department plans to offer OTC derivatives products in future. “KGI already has an OTC Derivatives license and is preparing to launch products for investors soon. This will encourage the growth of the Thai derivatives market, both OTC and exchange traded, to grow at a faster pace and in compliance with governmental policy on developing and strengthening the Thai capital market.”
Anyone interested in KGI’s SBL service should contact their account officers for more information or call KGI on 0-2231-1111 ext 171 or 259 End.