SRX 0.00% 17.5¢ sierra rutile holdings limited

warrants and structured products

  1. 8,917 Posts.
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    These have just been released (Jan 29th 2014) by CITI.

    http://www.asx.com.au/PDF/14-006CTW.pdf


    Would be very interested in anyone's take on these products.

    My reading of the pdf is that a trade on the SRXKOB is closed out if the price falls to $12.65. There is a carry cost of 9.5% (calculated daily which is 10% PA).

    Does this mean that for $2.52 plus 10% PA, you could have a 2 year run for about $3, plus the strike price of $11.88. So the SP would need to be above $15.

    Looks wrong to me - what am I missing here??



    ASX web site:
    SRXKOB
    Description: CITIWARRANTS 11.8778 SRX MINI LONG
    Type: Call
    Issuer: CITIWARRANTS (CGMA)
    Commenced trading: 29 Jan 2014
    Expiry: 31 Dec 2029
    Exercise level: 11.878 (expressed in $ or index points)
    Warrants/Structured Products per underlying instrument: 1.0000
    Exercise style: American
    Warrants/Structured Products issued: 140,000
    Product Disclosure Statement

 
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