Scotia DBG Stockbrokerage

Products

“Seasoned Investors - Invest in the stock market with less!” - Scotia DBG offers another first to the industry: Options and Margins. Designed specifically for the sophisticated investor, these services allow you to play the stock market with added advantages that are not available anywhere else in Jamaica.

Our stockbrokerage team offers you:

• SPEED AND EFFICIENCY
  This service is the fastest in the marketplace at executing and settling your order.
• RESEARCH AND EXPERT ANALYSIS
  Our website gives you exclusive access to both fundamental information and technical analyses of the leading companies that are listed on the Jamaica Stock Exchange.
• HIGH-QUALITY, PERSONALIZED SERVICE
  An experienced team of traders and analysts assist you in achieving your investment goals.

OPTIONS
Options contracts give you the opportunity to leverage your equity investments, while providing a hedge against market volatility. An option is a ‘derivative’ investment instrument that gains its value from an underlying asset. Equity options give you the right to either sell (”put” options) or buy (”call” options) a stock, at a predetermined price at some specified date in the future.

What is the benefit?
Options contracts allow you to ‘lock-up’ large volumes of stock at a fraction of the cost. A ‘call’ option gives you the right to buy stock at a fixed price at a fixed date in the future. A ‘put’ option, on the other hand, permits you to sell a stock at a fixed price on a future date.

Options contracts and their value
The options contract is initially priced using a fairly complex mathematical model, which is based on the current price of the underlying stock. Put/Call options contracts become more valuable if the price of the stock is decreasing/increasing.

MARGINS
Margin accounts allow the investor to leverage their equity investments to purchase stocks through a facility that Scotia DBG provides. The investor’s stocks are then used as collateral. To get started, 50% of the stock purchase is paid by the investor in cash. This 50% is known as the “margin requirement” and will vary at the discretion of Scotia DBG. The balance of the stock purchase is paid for with the funds borrowed from Scotia DBG and interest charged on the borrowed amount is based on Scotia DBG’s prevailing prime lending rate.

If the price of the stock falls to a level that results in the loan amount being more than 75% of the total value of the stock – meaning that the investor has less than 25% equity in the stock – the company will issue a margin call to the investor. This margin call requires the investor to deposit enough additional funds into his or her account to return their equity to the 50% margin level. The 25% limit is known as the “maintenance margin” and will vary based on the underlying stock, as well as on the discretion of Scotia DBG management.

What is the benefit of Options & Margins?
Your existing portfolio provides an immediate source of funds for the purchase of additional stocks in a market in which timing is everything!

How do I determine whether Options and/or Margins are right for me?
Options and Margins transactions are intended specifically for the sophisticated investor; however, Scotia DBG’s brokerage specialists provide personal assistance to help you identify your financial goals and will recommend the right service for you.

Will I have ready access to my investment?
Scotia DBG plays an active role in the securities market and is best positioned to buy or sell your open positions.

How risky are Options and Margins?
Options and Margins accounts do increase your market risk substantially. Our brokerage specialists will conduct a thorough assessment of the risks involved in your specific transaction before you buy/sell. Our website also gives you exclusive access to a wealth of information that will assist you in making informed decisions *.

How can I get started?
Our branches are centrally located island-wide and we are ready to help you meet your strategic financial goals. Call, or come in and speak with one of our Investment Advisors.

From time to time, Scotia DBG may have an interest in the securities that it sells to clients – meaning that the company may be an owner of/investor in the securities being offered.

* Please consult our “Options Risk and Disclosure Document” available from any of our Brokerage services.