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Traders cry foul over losses from SocGen actions on SIA shorts

Issuer of daily leveraged certs used what some say is an aggressive formula to calculate the price of SIA shares ex-rights

Published Fri, May 8, 2020 · 09:50 PM
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Singapore

TRADERS in the 5x Short Singapore Airlines (SIA) daily leverage certificates (DLCs) saw their positions go to zero on Wednesday when SIA shares rose more than 20 per cent upon trading ex-rights.

The short squeeze was exacerbated after Societe Generale (SocGen), the issuer of the certificates, used what some traders said is an aggressive formula to calculate the price of SIA shares ex-rights. SocGen also gave them very little time to hedge their bets in reaction, the traders said.

KEYWORDS IN THIS ARTICLE

SocGen
Singapore Airlines

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