SINGAPORE (BUSINESS TIMES) – SG Issuer, an issuing entity of the Société Générale group (SocGen), on Thursday May 27 permanently suspended trading of the 5x daily leveraged shorts (DLC) of BYD Electronic (International) Company on the Singapore Stock Exchange ( SGX). The suspension took effect at 9 a.m.
The move came after BYD’s stock rose 15% and triggered the airbag mechanism for DBEW and DKHW meters at 3:15 p.m. Wednesday.
While BYD’s stock saw a sharp 20% intraday rise in price to HK $ 55, SG Issuer said the DLCs have lost 100% of their value and will not recover any value even if they resume their trading. activities at a lower price. Thus, SocGen, as the designated market maker for DLCs, may not provide quotes if they are worthless.
BYD is a Chinese electric vehicle (EV) maker backed by magnate Warren Buffett. SG Issuer listed the DLC with the counter code DKHW on December 21, 2020, while DBEW was listed on SGX on February 4 of this year.
DLCs are an investment product specified under the guidelines of the Monetary Authority of Singapore because they have structures, characteristics and risks which may be more complex for ordinary investors. They offer investors fixed leverage of three to seven times the daily performance of the underlying stock or index.
Recent times have seen a resurgence of interest in EV games. Closer to home, several Singapore-listed companies such as Innotek and NanoFilm Technologies have also drawn attention to their exposure to the EV market.
Last week, KGI Securities raised its InnoTek price target to $ 1.12 from 73 cents, with an “outperformance” rating unchanged. It came amid the push from China EV of the precision metal component maker listed on the motherboard and “promising” first quarter numbers.
NanoFilm is working to anchor its presence in the electric vehicle market through its surface solutions for fuel cells.
Meanwhile, in March, transport operator ComfortDelGro teamed up with French energy company Engie to jointly bid on electric vehicle charging tenders in Singapore.
Interest in EV charging has also grown in the Republic. Just in April, utility provider SP Group partnered with car rental company Goldbell to provide electric vehicle charging solutions. Goldbell offered to acquire rideshare player BlueSG in February this year.
Green electricity retailer iSwitch also announced in April the acquisition of 12 electric vehicle charging stations in Singapore from Finnish technology company PlugIT.