Securities Borrowing and Lending (SBL)
SBL is an investment instrument for making profit during the bear market. Borrowing stocks at a higher price and buying back at a lower price for returning borrowed stocks back to lender. The lender gain from lending fee while still entitled to dividend rights.
Doing SBL transactions with Kasikorn Securities
Kasikorn Securities will act as a principal facilitator between the investor who wishes to short-sell the stock (the borrower) and investor who wishes to lend the stock (the lender). Kasikorn Securities will be the counterparty (lender) to borrower and the counterparty (the borrower) to lender.
Benefits of Securities Borrowing and Lending (SBL)
- The lender
- Receive additional return from lending fee.
- Remains entitles to dividend rights and other right in relation to the underlying stock.
- Underlying stock can still be used for calculation of collateral value with Kasikorn Securities.
- The borrower
- Opportunity to make profit during a stock downturn or to combine with other trading strategies such as pair trading or arbitrage trading.
Conditions of Securities Borrowing and Lending (SBL)
- Borrower must deposit collateral with Kasikorn Securities prior to the transaction. The collateral placed with Kasikorn Securities will earn interests.
- The amount borrow must meet the minimum volume requirement (i.e.100 shares).
- The price for short-selling must not be lower than the latest price (per SEC rules).
- Short-selling cannot be done during pre-opening (ATO) and pre-closing (ATC) sessions.
- The amount borrow is prohibited one day before and after the corporate actions’ day (XD, XR, XW, and etc.). Moreover, the amount borrowed must be returned to lender one day prior to any corporate action date.
- The Securities Borrowing and Lending (SBL) agreement has an on-call feature allowing the lender to call back the stocks at any given time.
Securities Borrowing and Lending (SBL) Fee
|Fee (per annum)
Interested investors can contact your financial advisor or