Introduction to Daily Leverage Certificates (DLC)

Daily Leverage Certificates are designed to multiply the daily performance of an underlying asset by a fixed factor of 3 or 5 times with bullish (Daily Long) and bearish (Daily Short) view.

  • Liquidity - listed on Exchange
  • Flexibility - buy/sell throughout the trading day
  • Simplicity - with a fixed daily leverage, 3x or 5x
  • Transparency - every investors sees the same price

How do Daily Leverage Certificates work?

There are 2 types of DLCs. Daily Long for bullish investors and Daily Short for bearish investors. DLCs offer a fixed leverage return (3x or 5x) on the underlying asset's daily performance.

Process of choosing a DLC:

  • Choose the Underlying Asset
  • Choose Daily Long or Daily Short Certificates
  • Choose the leverage Level (3x or 5x)

How do you trade Daily Leverage Certificates?

DLCs are listed and traded on the Singapore Stock Exchange (SGX) in a similar way to shares. DLCs are classified as Specified Investment Products (SIPS).

When you trade DLCs intra-day, the costs and fees mainly consists of the brokerage fee, trading fees and the bid/ask spread from trading which are typically the same as trading shares on the exchange.

When you hold DLCs overnight, you will need to bear the leverage and hedging costs and fees, such as the funding cost, rebalancing cost, the gap premium and the management fee, which are calculated daily and applied to the value of the DLCs.

What is Compounded Return?

Gains and losses are compounded over periods of more than one trading day, and as such will deviate from the leveraged performance of the underlying asset.

This difference may be amplified in a volatile market with a sideways trend, where market movements are not clear in direction that could generate significant losses for investors.

What is Air Bag Mechanism?

The Air Bag Mechanism is a safety mechanism that is built into the Daily Leverage Certificates. It is designed to reduce the negative impact of an extreme move in the Underlying Asset during the day.

Products Airbag Trigger
3x Daily Long -20%
3x Daily Short +20%
5x Daily Long -10%
5x Daily Short +10%