Singapore Market Daily Leverage Certificates (DLCs)

1. DLCs Introduction

Daily Leverage Certificates (DLCs) offer investors fixed leverage up to 7 times of the daily performance of the underlying asset (e.g. market indices or single stocks). Comprehending the principle is relatively easy – if the underlying asset moves by 1% from its closing price of the previous trading day, the value of a 3x DLC will move by 3%, and that of a 7x DLC will move by 7%.

2. DLC Naming Convention

3. Investor Suitability

Daily Leverage Certificates (DLC) are only suitable for investors willing to assume the potential of losing their entire investment principal within a short period of time. Investors should also have sufficient understanding of the product and should possess either a high level of knowledge or sufficient trading experience to properly evaluate and assess the product structure , associated risks, valuation, costs and expected returns.

DLCs seek to achieve short-term investment results that correspond to the daily magnified performance of the underlying asset. DLCS are products with features that might be more complex in nature and are only suitable for investors who possess the investment knowledge of more complex products and have a high risk tolerance. Hence, all investors need to be qualified to trade in Specified Investment Products (“SIP”) to be able to trade DLCs. For more information on SIP, visit sgx.com/sip.

Investors are advised to read the listing documents for the relevant DLC before making any investment decision.