Shares, Options and ETFs

 

Direct access to all main global exchanges: New York Stock Exchange, Nasdaq, London Stock Exchange, Euronext, Hong Kong Stock Exchange, Toronto Stock Exchange etc. Wide selection of international financial instruments: shares, options on shares, ETFs, bonds, depositary receipts (ADR/GDR).

Shares

A share is a security issued by a company. It grants the holder with a right to participate in the joint-stock company management and to receive dividends on the share.

Shares are issued to increase company’s capital (to attract additional financing), with the purpose of further development of the company. A share is an instrument for capital investment, it belongs to equity securities.

The investment potential of a share depends on many characteristics, the most important of which are the issuer’s financial conditions, credibility, liquidity and the earning power. Shares investment opportunities are related to their trading on stock and OTC markets, which means that they can generate income not only form of dividends, but also as a result of their value changes.

Value fluctuations can be very significantly and can surpass dividends size by far. Many joint-stock companies do not pay dividends, but their shares values may increase several-fold.

Options

An option is a contract which gives the potential buyer or the potential seller of an underlying asset (commodity or security) the right, but not the obligation, to buy or sell such an underlying asset at a specified price on a specified date or within a specified time period, whereby the option seller has the obligation to fulfill the transaction (that is to sell or buy) according to the terms of the sold option.

There are options to buy and to sell an underlying asset:

  • Call option: an option to buy. This option gives the option buyer the right to buy the underlying asset at a specific price.
  • Put option: an option to sell. This option gives the option buyer the right to sell the underlying asset at a specific price.

Consequently, four kinds of option trades are possible:

  • buying a call option;
  • selling a call option;
  • buying a put option;
  • selling a put option.

ETF

An ETF (Exchange Traded Fund) is a fund traded on stock exchanges. It mirrors the structure and the movement of the chosen underlying asset. Underlying assets of ETFs may be interest rates, currencies, stock indexes, commodities and various other assets. ETF is traded as a common equity and transactions with this instrument can be executed during the whole trading day.

ETF structure can include strategies related to the underlying asset value decrease or increase.

Advantages of shares, options and EFT trading at Renesource Capital:

  • Wide selection of trading platforms;
  • Electronic access to trading;
  • Competitive commission fees;
  • Margin trading and short selling;
  • Trading on pre-market and after hours;
  • Electronic access to OTCBB and Pink Sheet trading.

Risk Disclosure Statement. Margin transactions (Forex, contracts for difference CFD, futures and futures options, stock options, REPO transactions, transactions in over-the-counter derivatives and transactions using broker credit, including selling short) involve higher risk. The level of risk increases with the leverage ratio. As the result of margin transactions, relatively high profits are possible with low level of initial investments, as well as significant losses which may exceed the principal amount of investments or the amount of the collateral. Please ascertain whether margin transactions in their essence and content suit the risk profile that was assigned to you by AS IBS Renesource Capital and whether the content of margin transactions corresponds to your investment goals.