Macquarie has launched its 1,000th warrant in Malaysia, following the issuance of 12 new warrants this week, and continues to command a leading market share, with 60.1% of the Malaysian warrant market turnover.

This year in Asia-Pacific, Macquarie has issued 665 warrants and 243 callable bull/bear contracts (CBBCs) with a M$468m sales volume, which includes 156 warrants worth M$468m, ranking first among all distributor groups in the country, followed by RHB Bank and K&N Kenanga Holdings, according to SRP data. Most popular underlyings this year include the Hang Seng Index (22 products), FTSE Bursa Malaysia (10) and S&P 500 (six).

"The enquiries that we receive these days from investors indicate that they are improving their understanding and becoming more knowledgeable towards warrant pricing," said Barnaby Matthews (pictured), head of equity derivatives products for Macquarie in Asia.

Structured warrants turnover increased to an average of M$97.5m per day for the first five months of 2018, compared to an average of M$25m in 2017, with daily turnover hitting a high of M$613.1m on April 6, 2018, which represented a 40.2% of the total turnover on the Bursa Malaysia for that day.

Warrants on Malaysian single stocks took a significant piece of the warrants market, with a 52.3% of turnover in the first five months of 2018, compared to 79.2% in 2017, with Sapura Energy, Supermax, Hengyuan Refining and My EG Services particularly popular over the period.

Index warrants have been actively traded since March 2018, particularly call and put warrants on the Hang Seng Index, which made up 43.9% of warrant turnover between January 1 and May 31.

The biggest change to the Malaysian market in recent years took place in January, when the government removed the stamp duty for warrants trading, effectively opening the door to high frequency traders. "This has resulted in an increase in traded volumes," said Matthews, adding that the exemption appears to have had a positive effect, with warrant volumes increasing 163% compared to the same period last year.

"Our Live Matrix tool is the first of its kind in Malaysia, allowing investors to see exactly where our warrant bid and offer prices will be throughout the trading day," said Matthews. "It gives a huge increase in confidence to investors who trade our warrants."

The bank has five episodes of animated educational videos that explain the basics of structured warrants and, in October 2017, launched the "Success Speaks" testimonial videos series featuring three investors speaking about their warrant trading experience, garnering a total of over 4.5 million views. Aside from that, Macquarie also organizes guest speaker seminars annually, with its most recent large-scale seminar "Navigating the Malaysian Market" held in March 2018 and featuring Daryl Guppy.

Related stories:
Live matrix will add transparency to the structured warrants market, Macquarie

Singapore’s warrants market soars in 1Q18

Warrants and CBBCs activity in the Asia-Pacific on the up