Covered Warrants

Introduction to Covered Warrants

Covered warrants give the investor the right, but not the obligation to buy (calls) or sell (puts) in the underlying asset. Their aim is to replicate the same financial exposure as buying (call) or selling (put) an asset such as a share, index, commodity or exchange rate at a predetermined price (strike price) on a predetermined date (expiry).

The lifespan to expiry is usually between 3 months and 3 years from issue. If held until expiry, the cash value of the warrant (if positive) will be credited to the investor.

Find out more about Covered Warrants

Featured Manager

SG CIB, the investment banking division of Societe Generale, is the world's largest listed products issuer, with a 20 year track record of providing an outstanding trading service. Each year, more than €10 billion is traded in SG listed products across 10 global stock exchanges (Paris, Brussels, Madrid, Milan, London, Frankfurt, Helsinki, Hong Kong, Tokyo and Singapore).

With the largest number of listed products in the world, SG enables investors to leverage all their investment objectives, using either of the three sub-families: Replication, Investment Strategies and Leverage.

In the UK, Societe Generale has been present in the Listed Products business since the opening of the Covered Warrants market by the London Stock Exchange in 2002. Today, Societe Generale is a major player in the Exchange Traded Products market.

Find out more about Societe Generale

Investing in Covered Warrants

Existing Customers

  • Login to your investment account
  • Under 'account admin' complete the appropriateness test by selecting 'Add the ability to trade complex products' link
  • Then use the ‘Buy’ button above relating to the product you wish to invest in

New Customers

If you have any queries please call our team on 0845 200 3637

Why use Covered Warrants:

  • By trading both long (call) and short (put) positions you have the potential to profit from both price rising and falling markets
  • Access a huge range of markets including UK and International Equities, commodities and currencies
  • Covered Warrants trade just like ordinary shares but as they geared investments, investors gain the same level of exposure at a fraction of the cost
  • As you don't own the underlying asset Covered Warrants do not attract Stamp Duty (tax laws may change)
  • Your maximum loss is always limited to the initial amount invested, however, covered warrants are considered as high risk as the capital is fully at risk
  • You can buy and sell covered warrants on the London Stock Exchange (LSE)
  • As they trade just like ordinary shares our standard commission rates apply. See our full rates and charges
Example Markets
EPIC Underlying Type Strike Expiry Parity Price
SA78 FTSE 100 Index Put 6,300 20-Jun-14 1,000 [iiiticker:LSE:SA78]
SA79
FTSE 100 Index Put
6450
20-Jun-14
1,000
BidOfferChangeTrade
00+0.00Buy
SC43FTSE 100 IndexCall700019-Dec-141,000
BidOfferChangeTrade
£0.0868£0.0888+0.01Buy
SB30 BP Call 5.50 20-Jun-14 1
BidOfferChangeTrade
00+0.00Buy
LC29 Tesco Call 5.00 18-Dec-15 1
BidOfferChangeTrade
£0.0145£0.0345+0.00Buy
SB15
Apple Call 600 20-Jun-14 100
BidOfferChangeTrade
00+0.00Buy
SO85
Goldman Sachs
Call 250
18-Dec-15
100
BidOfferChangeTrade
£0.0065£0.0165+0.00Buy
SB95 S&P 500 Call 1800 20-Jun-14 100
BidOfferChangeTrade
00+0.00Buy
GEF3
Nikkei 225 (Quanto)
Call 20,000
11-Dec-15
1,000
BidOfferChangeTrade
£0.4635£0.4735+0.00Buy
SB03 Gold Call 1500 30-Jun-14 100
BidOfferChangeTrade
00+0.00Buy
SA73 Gold Put 1000 30-Jun-14 100
BidOfferChangeTrade
00+0.00Buy
SY66BRENT FutureCall12012-May-1410
BidOfferChangeTrade
00+0.00Buy

See the full list of covered warrants available from Societe Generale here.

Risk Warning

Before trading you should fully understand the nature of covered warrants and your exposure to the risk involved. The geared nature of covered warrants means that a relatively small movement in the share price of the underlying asset will result in larger movements in the value of the warrant. Therefore, covered warrants provide the opportunity for greater returns than ordinary share dealing but also greater risks and potential losses. If you are in any doubt you should consult an Independent Financial Advisor.

Latest insight from Societe Generale

From July 1st 2014, all existing ISAs as well as new accounts opened after July 1st are now NISAs. Investors will now benefit from increased investment limits and flexibility. Click here to find out...
In this Money Observer opinion piece, Ben Thompson, Business Development Director for Listed Products and Lyxor ETF UK, explains how investors can gain exposure to emerging markets with ease and...
Having raised his stop-loss on the Apple Call Warrant SA47 for six consecutive times, Andrew finally closes his position, locking in a 118% profit.