Covered warrants to be officially listed on June 28

Covered warrants (CWs) will be officially listed and traded on the Vietnamese stock market from June 28, according to the State Securities Commission of Vietnam (SSC).

The SSC said at a press briefing on June 24 thatthere are 16 securities companies eligible to issue CWs and 26 stocks that meetconditions to serve as underlying stocks for CWs at present. 

The commission has received 17 dossiers fromeight securities companies registering to sell CWs based on the underlyingstocks of MBB, HPG, MWG, FPT, PNJ and VNM. It has granted issuance certificatesfor 16 CW products of seven firms.

According to the issuance plan, about 28.9million CWs worth the maximum of 104 billion VND (4.5 million USD) will beissued, SSC Vice Chairman Pham Hong Son said, adding that the SSC is verifyingother dossiers to grant issuance licenses to other securities businesses.

He noted CW issuers are securities companieswith charter capital of over 1 trillion VND, good business performance, andability to pay debt reaching maturity and meet financial safety criteria.

Bui Hoang Hai, Director of the SSC’s SecuritiesBusiness Management Department, said the CW deployment will help investorsprevent not only risks in the market but also specific risks of each type ofstocks.

CWs usually have longer maturity dates comparedto derivatives, so they are suitable for investors who want to prevent risksfor their long-term investments. CWs are also an investment tool with highflexibility suitable for many investors’ demand thanks to low investment costand known maximum loss.

However, experts also recommended that as CWsare new, investors should thoroughly learn about them before making investmentto avoid risks.-VNA

Leave your comment on an article