SG Warrants: SG securities London ltd, Société Générale, SG, financial tools, live quotes

A warrants' price can vary relative to underlying due to factors unique to the warrants e.g. changes in volatility and time value. For example call warrants on RIO can decrease in value due to falls in Volatility even if the share price of RIO increases.

As the sole market-maker, we are committed to ensure our warrant prices are always broadcast, however due to factors often out of our control e.g. technical issues with providers' feeds, there may be occasions whereby our warrants' prices are not broadcast. In such events we will always endeavour to do whatever is in our power to resolve these issues promptly.

Warrant risk factors

Leveraged returns are a major advantage of warrants but can also work against investors. Warrant investors should be aware that, if the underlying instrument to the warrant moves in the opposite direction to that anticipated by investors, the losses incurred by the warrant will be greater in percentage terms than those incurred by the underlying itself. The prices of warrants can therefore be volatile.

Warrants have a limited life, as denoted by the expiry date of each issue. After this date, warrants can no longer be traded or exercised. Investors should note that warrants experience time decay (erosion of their time value) throughout their life. The rate of this decay accelerates as warrants near expiry and warrants may expire worthless. You should not buy a warrant unless you are prepared to lose all of the money you have invested plus any commission on transaction charges.

It is important to note that while changes in the underlying price are generally the most important factor for warrants, other variables - such as market volatility, interest rates, exchange rates and dividends - may lead to a change in the price of a warrant even if the underlying itself is unchanged.

It should also be noted that when the underlying price is unavailable - when the market on which the underlying is listed is closed, for example - a warrant price will move in line with an appropriate substitute, such as an future or option contract traded on a Related Exchange as specified in the relevant Pricing Supplement.

This site is intended for investors who intend to trade in listed warrants in the United Kingdom. It is not provided to any person who is a resident of any other country.

Nothing in this website constitutes advice on the merits of buying, or selling a particular investment or exercising any right conferred by the warrants described. SG does not offer investment advice in respect of these products.

SG does not accept any liability (whether direct or indirect) arising from use of the information contained in this website. The information in this website is, to SG's knowledge, reliable and accurate but this cannot be guaranteed. The views of SG reflected in this website may change without notice. To the extent possible at law, SG does not accept any liability whatsoever arising from the use of the material in this website.

Figures included in this website take no account of personal tax liability. The value of warrants may be exposed to fluctuations in rates of exchange, and these may have an adverse effect on the value or price of the warrant. The value of warrants can go down as well as up. Any returns referred to in this website are illustrative only and do not constitute projections of expected returns unless expressly specified as such.

Information given about the past performance of warrants or the securities underlying them is no guarantee of future performance. No investment decision should be taken without reading the Listing Particulars relating to the particular warrant concerned. A copy of the Listing Particulars may be obtained from Société Générale at Exchange House, Primrose St, London EC2A 2HT upon request.

SG or its associates may from time to time have a position, or material interest in the warrants described in this website or the investments underlying them. Generally SG will be the only market maker in the warrants discussed and will or may have provided significant advice in relation to the warrants and the investments underlying them.

Secondary Market

Secondary market risk is the risk that investors may not be able to open or close a Covered Warrants position at the desired price. SG is the only market maker in SG Covered Warrants. Under normal conditions SG will endeavour to provide a market-making service. Such arrangements may be temporarily or indefinitely curtailed as a result of technical problems within companies of the SG Group or the London Stock Exchange or data vendors or telecommunications carriers, or in the event of pending announcements by or difficulties in procuring information on underlying companies.

Third party information

Any third-party advertising, information and referral buttons containing hyperlinks are not recommendations or endorsements by SG or its respective directors, affiliates or employees. The user is referred to the relevant third party for all relevant information, including complete information on that entity's investment adviser or dealer licensing status (if applicable).

Trademarks

The name, logo and trademarks of SG and its affiliates ('SG') are reproduced by permission of SG. Where any warrant is based on an index, the index provider will have no liability to you in respect of its activities in respect of that index.

Technical Analysis Methodology

Technical analysis studies market psychology, price patterns and volume levels. It is used to forecast future price and market movements. Technical analysis is complementary to fundamental analysis and news sources.

The information in this document has been obtained from or is based upon sources believed to be reliable but is not guaranteed as to accuracy or completeness although it is believed to be fair and not misleading. The use and interpretation of this newsletter requires financial skill and judgment. This is non-impartial research as defined by the Financial Services Authority.

This newsletter is issued by Société Générale ("SG"). SG is authorized by Banque de France and by the Financial Services Authority; regulated by the Financial Services Authority for the conduct of UK business.

The views expressed in this newsletter are those of Day By Day (www.daybydaytraders.co.uk). Day by Day is an independent research bureau specializing in technical analysis. DayByDay analysts are FTA or IFTA qualified. DayByDay provides different retail investors, private banking managers, prop traders, and asset managers with commentaries, anticipations, and strategies according to their specific needs.

DayGraph is designed for retail customers. It relies on a technical system using trend following methods to assess the medium term trend (1-2 months), combined with overbought/oversold and volume indicators to assess the short term (1-2 weeks) reversal probability, and level identification algorithms to identify areas that may cause price reaction. DayGraph technical assessments are based on a rigorous methodology. Readers can expect consistency over time.

This newsletter is provided to you for your own personal use. You are not authorised to reproduce the information and commentaries contained in this newsletter for any commercial purpose or to copy, reproduce, duplicate, redistribute, sell, resell or exploit any portion of this newsletter. All copyright and/or other intellectual property or proprietary rights in the newsletter shall remain the sole and exclusive property of Day by Day.

Nothing in this newsletter constitutes advice on the merits of buying or selling a particular investment or exercising any right conferred by the warrants described and SG does not offer investment advice in respect of these products.

Warrants are not suitable for everyone. You should not deal in warrants unless you understand their nature and the extent of your exposure to risk. You should be satisfied that they are suitable for you in the light of all your circumstances and financial position. Information given about the past performance of warrants or the securities underlying them is no guarantee of future performance. The value of warrants may be exposed to fluctuations in rates of exchange, and these may have an adverse effect on the value or price of the warrant. The value of warrants can go down as well as up. Any returns referred to in this newsletter are illustrative only and do not constitute projections of expected returns unless expressly specified as such. Where any warrant is based on an index, the index provider will have no liability to you in respect of its activities in respect of that index.

Any decision you make regarding a possible purchase of warrants is your sole responsibility and liability. If you are in any doubt you should consult an appropriately qualified financial adviser. SG and Day by Day hereby exclude all legal liability directly or indirectly arising in respect of the utilisation of the information in this newsletter to the fullest extent permissible by law and regulation. Consequential and economic loss is excluded without limitation.

SG and our affiliated companies within the Société Générale Group may from time to time have a position, or material interest in the warrants described in this newsletter or the investments underlying them and may have provided advice to the companies underlying them. Société Générale SA, who is member of LSE, will be the only market maker in the warrants mentioned.

Past technical analysis, up to 12 months, is available for all underlyings on the SG website, www.warrants.com.

Moving averages
Moving averages are calculated by the addition of the closing price of the N last sessions divided by the number of sessions considered. They can be used to track daily, weekly, or monthly patterns. DayGraph uses 20 and 50 periods. Moving averages provide a good indication of the whole trend affecting an underlying. Reversing situations can be found on the upside and on the downside. Moving averages can constitute supports or resistances by themselves for spot prices.

MACD
The MACD (Moving Average Convergence / Divergence) reflects a difference between moving averages and thus makes reference to the ascendancy or not of the mid-term relatively to the short term. DayGraph uses 26 and 12 periods. Moreover, so as to estimate the variations of the trends, an auxiliary indicator (named signal line) is formed. It is based on an exponential average of the MACD on 9 periods. The advantage of this indicator is triple:

Moving averages are calculated by the addition of the closing price of the N last sessions divided by the number of sessions considered. They can be used to track daily, weekly, or monthly patterns. DayGraph uses 20 and 50 periods. Moving averages provide a good indication of the whole trend affecting an underlying. Reversing situations can be found on the upside and on the downside. Moving averages can constitute supports or resistances by themselves for spot prices.The MACD (Moving Average Convergence / Divergence) reflects a difference between moving averages and thus makes reference to the ascendancy or not of the mid-term relatively to the short term. DayGraph uses 26 and 12 periods. Moreover, so as to estimate the variations of the trends, an auxiliary indicator (named signal line) is formed. It is based on an exponential average of the MACD on 9 periods. The advantage of this indicator is triple:

- absolute position of the MACD

- relative position to its signal line

- existence of divergences.

RSI
RSI is the most popular speed indicator because it is one of the most relevant ones in localizing overbought and oversold periods depending on the investment horizon. A bounded indicator, the RSI calculates the relationship between the average of ups and downs for the days of the period under consideration with a mathematical approximation. Day traders use a 5-minute RSI, monthly market investors use a 5 or 9-day RSI, portfolio managers monitor the RSI for 14 days and some investment funds would even go to the RSI 34. The longer the RSI is, the less the overbought and oversold thresholds are distanced (20/80 for a 9-day RSI, 30/70 for an RSI 14). It also gives excellent divergence signals. It is the Rolls Royce of indicators... DayGraph uses a 14-day RSI.

Stochastic
With a design close to that of the RSI, the stochastic indicators use a greater number of variables (highs and lows for the day). The slow %D used smoothes the variations of the base indicator that is too volatile. Paradoxically, the false signals are often more numerous than for the RSI. The main contribution compared to the latter is still notable though: when the stochastics remain stuck in an overbought area (above 75%) for several weeks, it is recommended not to follow the overbought indications of all the other indicators.

Bollinger bands
Bollinger bands are trading bands (upper and lower boundary lines) plotted at 2 standard deviation levels above and below a moving average. DayGraph uses 20 periods. Bollinger bands offer a measure of volatility and relative low and high, the bands widen during volatile markets and narrow when volatility decreases. They can provide strong thresholds: resistance for the upper band and support for the lower band.

Support
Level that has a high probability of halting a fall on the time horizon considered, and consequently, possibly to cause a bounce.

Resistance
Level that has a high probability of halting a rally on the time horizon considered, and consequently, to cause a correction.

Warrant Terminology
Type: C = Call, P = Put

Strike: The price at which the holder has the right to buy (call) or sell (put) the underlying share or index

Parity: The theoretical number of warrants needed to give the holder the right to one unit in the underlying

Elasticity is equal to the leverage multiplied by the delta. It represents the percentage change in the price of a warrant arising from a percentage change in the underlying.

Delta: The delta of the warrant is the theoretical amount by which the warrant price will change for a one unit change in the underlying.

For any queries regarding SG warrants, please contact ukwarrants@sgcib.com.

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