Frequently Asked Questions
What are the key advantages of using SBL facilities as opposed to other short selling tools?
How do I open a SBL account with Phillip Securities?
Do I have to sell through Phillip Securities after I have borrowed the securities from Phillip Securities?
How many times can I leverage on my capital through using Phillip Securities’ SBL facilities?
How do I perform the short trade?
Can I sell direct to the highest bidder (highest buyer’s price) using SBL facilities?
Do I need to put in any collateral after I have sold the securities?
How do I compute the value of collaterals required (initial margin & maintenance margin) for the securities I borrowed?
Initial Margin = 30% of market value of loaned securities
Maintenance Margin = 130% of market value of loaned securities – (sales proceeds receivable / received + existing collaterals)
What are the securities available for borrowing?
What happens if the securities that I have sold have corporate actions such as dividend distributions, bonus issues or rights issues?
What do I need to note when I intend to short sell the securities during a corporate action entitlement (dividend / bonus / rights) period but only buy back after the ex-date?
After I have bought back the securities, do I have to return the securities?
- If securities are returned on purchase due date or earlier, interest will cease to accrue on the purchase due date
- If securities are returned after due date of purchase, interest will cease to accrue one day after the return is done
What happens if there is a recall of the loaned securities?
How is margin call computed?
How do I satisfy a margin call?
- Top up by cash
- Top up by depositing marginable securities prescribed by Phillip Securities.
- Reduce short exposure
- Sell long positions of securities within the SBL account
Is there a maximum period I can borrow the securities?
Is there a minimum period I can borrow the securities?
Can I withdraw the securities borrowed?
Can I withdraw the cash / securities collateral?
What will be the charges incurred for a SBL loan?
- Administrative Charge - S$20 Per Contract
- Settlement Fee - S$0.35
- Borrowing Fee Varies. Minimum borrowing fee of S$15 apply.
- Kindly check with your TR or our SBL Desk officer for specific rate.
Are there any other relevant charges?
You will incur negative (debit) balance if your SBL account does not have sufficient funds in the settlement currency.
|Currency||Interest on Debit Balance|
Note: Charges & fees are before GST.PSPL reserves the right to change the rates without prior notice.
Do I get paid for credit cash balances?
How does a SBL transaction work?
Client borrowed 10,000 securities of ABC securities on 2 July. He bought back 10,000 of ABC securities on 4 July and returned them on 9 July. Assuming (a) borrowing fee is 6% p.a. and (b) average of closing prices between 2/7-9/7 is $5, total cost incurred for an SBL loan will be calculated as follows:
- Admin Fee = $20
- CDP Settlement Fee = $0.70 (buy & sell contracts)
- Borrowing Fee = [6% / 365days x 8 days loan x 10,000 securities x $5 (average of closing price between 2/7 - 9/7)] = $65.75
Note: Charges & fees are before GST.
Do I need to disclose my Short Selling positions?
Under the Securities and Futures (Short Selling) Regulations 2018, investors with short positions above a specified threshold* are required to report these positions to MAS through a new online portal, the Short Position Reporting System (SPRS), with effect from 1 October 2018.
* A short position has to be reported to MAS if it reaches or exceeds the lower of:
(a) 0.2% of total issued shares or units; or