Hang Seng warrants: traders complain
In 3 letters to SGX and MAS, they allege Macquarie's pricing is "unfair" and "erratic", with warrants often not moving in line with underlying index
Singapore
A GROUP of professional traders has complained three times over the past six months to the Singapore Exchange (SGX) and the Monetary Authority of Singapore (MAS) about the market-making activities of Macquarie Capital Securities (MCS) for the Hang Seng Index (HSI) warrants issued by Macquarie Bank (MB).
In complaints dated Nov 12, 2014, Dec 22, 2014 and March 8, 2015, the traders alleged that the warrants often did not move in accordance with the underlying index and the theoretical pricing model. They listed dozens of instances, illustrating situations where call warrants fell instead of rising when the HSI rose, and where put warrants also fell when the HSI dropped.
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