The prices shown in the chart above are indicative only. The prices above may not be the prices at which investors can buy or sell the Product or the Underlying. Historical pricing is not a reliable indicator of future pricing and does not take into account potential third party costs, fees or charges. Historical pricing is not based on simulated or hypothetical data.
S&P 500 2950 CALL 20/12/2019
A Warrant is an instrument which gives the holder the right to notionally buy (“Call Warrant”) or sell (“Put Warrant”) an underlying reference asset (the “underlyer”) at a pre-defined price (the “strike”), either during the term of the Warrant or on a specific date at the end of the fixed term (the “expiration date”). For example: If a Call Warrant has a strike of 100 Euros, it allows the holder to notionally purchase the underlyer at a price of 100 Euros and if a Put Warrant has a strike of 100 Euros, it allows the holder to notionally sell the underlyer at a price of 100 Euros.
The right to buy or sell the underlyer under a Warrant is described as notional because a holder does not have the right to physically buy or sell the underlyer. Instead, (a) in the case of a Call Warrant, if the price of the underlyer at exercise is higher than the strike of 100 Euros, the holder will receive a cash amount equal to the difference between the prevailing price of the underlyer and the strike, and (b) in the case of a Put Warrant, if the price of the underlyer at exercise is lower than the strike of 100 Euros, the holder will receive a cash amount equal to the difference between the strike and the price of the underlyer. In the case of rising underlyer prices, Call Warrants tend to rise in price while Put Warrants tend to fall in price. Conversely, in the case of falling underlying prices, the price of Call Warrants tends to fall and the price of Put Warrants tend to rise.
If the Warrant exercise style is “American”, a holder may exercise it at any time during the lifetime of the product. If the Warrant exercise style is “European”, a holder may only exercise it on the expiration date. Apart from the possibility of exercising an American style Warrant at any time during its term, Warrants may also be traded on a daily basis in the secondary market.
A Warrant provides leveraged exposure to an underlying asset. Leverage means that a price movement in the underlyer can result in a greater movement (either positive or negative) in the price of the Warrant. The price of a Warrant may not move directly in proportion to the price of the underlying as the exact Leverage of a Warrant will be determined by various factors, for example, the term, the distance between the strike and the price of the underlyer and implied volatility. This can be described as the “Leverage Effect”. The Leverage Effect can lead to significant gains or losses in a short time period. Leverage will change over time and can do so rapidly in response to changes in the prices of the underlyer. An investment in a Warrant with a higher Leverage may lead to a higher percentage gain on the money invested. Conversely, such an investment can also lead to higher losses and an increased risk of the Warrants expiring worthless at maturity.
At expiration, a Warrant expires worthless with a total loss of invested capital if the underlyer is trading at or below the strike for Call Warrants and at or above the strike for Put Warrants. In contrast to Turbos, Warrants do not have a knock-out feature.
The final valuation of a Warrant will be determined on the date it is exercised (in the case of an American style Warrant) or on the expiration date (in the case of a European style Warrant, or an American style Warrant if it has not been exercised). Any amount payable under a Warrant will be paid five business days after the final valuation.
Your capital invested will always be at risk while holding the product. Warrants are designed to be instruments for short term investing.
For further information on the mechanics of Warrants, please refer to the Final Terms document together with the Base Prospectus.
Investing in products can be risky and you may lose a significant proportion, or all, of your capital invested. Please ensure that you read and understand the information contained in the Base Prospectus and the relevant Final Terms and the additional information on this website, particularly the section “Risks” of this website before making any decision to purchase any product.
*The Guarantor has guaranteed that if the Issuer does not pay any sum due or perform any other obligation in respect of a Product when such sum or performance is due, the Guarantor will pay that sum or perform that obligation.
Historical prices are not a reliable indicator of future prices and investors may get back less than the amount invested. Any information provided herein is for informational purposes only and is subject to change without notice. It is not intended as a recommendation of or an offer or solicitation to purchase or sell any financial product or service or as a recommendation of an investment advisor. Users should consult their own advisors regarding legal, tax, accounting or any other aspects including suitability implications of the product for their particular circumstances.