Why trade Equities with Veridian
Whether you’re managing your super, hedging your existing portfolio or generating income, Veridian Securities will provide you with the best possible execution, settlement and reporting. Our clients have the option to execute transactions themselves through webIRESS or contact our dedicated dealing desk to execute on their behalf. Transactions settle with your dedicated Cash Management Account, which can be accessed by telephone or internet banking or simply by making a request of our Cash team.
How does Equities Trading work?
Buying a share makes you a part equity owner in that company. As a part owner of a business you are entitled to benefits, such as a share of profits distributed through dividends and usually the right to vote at company meetings.
BUY OR SELL
THREE DAYS AFTER
SETTLE YOUR HIN
The webIRESS platform provides investors with comprehensive dividend information. Build your dividend portfolio and enjoy automatic dividend distribution to your dedicated Cash Management Account.
If you self-manage your super, Veridian Securities offers Premium Portfolio Wrap services, allowing you to quickly and easily generate reports and manage your tax reporting requirements.
Corporate Deal Flow
Veridian Securities provides access to corporate deal flow from some of the most respected names in the industry. Our corporate team is a hand-picked collection of experienced individuals in a variety of industries.
Though the Australian share market is usually liquid, there are times when you may not find a buyer or seller at the price you want due to certain market conditions.
Equity shares are subject to market movements, which can be rapid and are dependent on local and global economic factors. Some shares may be more susceptible to these factors, represented by greater price volatility.
If the market moves against you and you sell your shares for a lower price than you bought them for, you will be subject to a capital loss.
What are CFDs?
Contracts for difference (CFD) are leveraged trading instruments written over existing underlying securities. The CFD allows you to control a position in a given security and gain exposure to price movements without having to fund the full value of the position. CFDs differ from HIN shares in that they can be long or short and the owner of the contract does not own the underlying security. Trading CFDs with Veridian Securities is built upon a foundation of Direct Market Access (DMA) execution. We provide clients with a pure agency brokerage service and link you directly to the relevant exchange with no requotes or spreads. Our live data feed lets you see level 2 market depth on most exchanges and our range of order types ensures that you trade with confidence.
How do CFDs work?
Trading CFDs gives you exposure to price movements of underlying securities without having to own them. You may profit from underlying security price rises by taking a long position in a CFD. Alternatively, you may also profit from a price fall by taking a short position in a CFD.
When Trading CFDs
- Make a small cash deposit, called an Initial Margin, that serves as collateral. - Buy a CFD to open a long position or sell a CFD to open a short position. - Profit and losses accrue in real time as market prices fluctuate. - Sell the CFD to close a long position or buy the CFD to close a short position.
Consider the following example of Trader A purchasing 100 BHP shares on HIN and Trader B using a CFD
- Trader A purchases 100 BHP @ 34.00 at a cost of $3,400. Trader A sells the 100 BHP @ 36.00 and receives $3,600. The $200 profit represents a 5.9% return on the initial $3,400. - Trader B purchases 100 BHP @ 34.00 using a CFD. Trader B’s cost of this purchase is 10% of the value of the position or $340. Trader B sells the 100 BHP @ 36.00 and receives the initial margin plus realised profit or $540. The $200 profit represents a 59% return on the initial $340.
Automatic short selling is available on over 1300 CFDs worldwide. Should you wish to go short a security not on this list, simply contact our dedicated dealing desk to request a stock-borrow. In most cases we will advise you of the outcome of your request within 20 minutes.
Direct Market Access
Veridian Securities gives clients access to 21 exchanges worldwide. Gain access to US, Asian, European and Australian equities markets, futures markets and commodity markets around the world.
Order Type Options
Veridian Securities offers a range of conditional order types, including stop losses, guaranteed stops and trailing stops, that can help you manage the risks of leveraged trading.
The ability to take long or short positions in CFDs offers potential profit opportunities in both rising and falling markets. In addition, most CFDs do not have an expiry date, so you can trade them according to your time frames.
Minimal Initial Margin
With CFDs you can potentially make a higher return on investment than if you invested in the underlying security directly. CFDs require only an Initial Margin, representing a fraction of the total underlying value, to open a position.
Utilise CFDs to hedge your portfolio no matter its size or composition. For example, if you hold a long position in a single stock, you can open a short position in a CFD for that stock to provide protection against negative movements.
No Requotes, No Spreads
Veridian guarantees our clients no requotes and no spreads on CFD trades, allowing them to trade efficiently according to the strategies they employ.
Open CFD positions can be affected by gapping if the market opens at a significantly different price from the previous day’s closing price. This may have particularly adverse effects on leveraged positions.
As a leveraged financial product, CFDs carry significantly more risk than their underlying securities. While leverage allows traders to benefit from higher returns, it can also lead to losses greater than the initial investment.
If the market moves against you or margins increase you may have to provide additional funds at short notice. If you do not, your position may be closed and you will be liable for any resulting loss.
What are ETOs?
Exchange Traded Options (ETO) are versatile, leveraged derivative securities. ETOs can be used to hedge existing investments, reduce risk or make speculative trades. In addition, because of the flexibility offered by ETOs, investors are able to employ a large range of strategies, from simple to complex, to trade in every market. Veridian Securities gives clients access to trade ETOs on the ASX. In addition, our specialist advisors can provide assistance with executing complex trading strategies, ensuring that you are well informed when making your investment decision.
How do ETOs work?
There are two types of ETOs that are the basis for all options strategies, Call Options and Put Options. Both can be sold (written) or bought (taken).
- Buyers (takers) of Call Options have the right, but not the obligation to BUY a specified volume of an underlying security for an agreed price, on or before a specified expiry date. Buyers of Call Options benefit from limited downside risk, but pay a premium for the option. - Sellers (writers) of Call Options have the obligation to SELL a specified volume of an underlying security for an agree price up until expiry of the option. Sellers of Call Options benefit from earning premiums, but have unlimited downside risk.
- Buyers (takers) of Put Options have the right, but not the obligation to SELL a specified volume of an underlying security for an agreed price, on or before a specified expiry date. Buyers of Put Options benefit from limited downside risk, but pay a premium for the option. - Sellers (writers) of Put Options have the obligation to BUY a specified volume of an underlying security for an agree price up until expiry of the option. Sellers of Put Options benefit from earning premiums, but have unlimited downside risk
tailored outcomes through the provision of timely analysis and advice.
Long Options Limit Downsides
When you open a long position with ETOs (buy a call or a put) your downsides are limited to the premium you paid for the position. In this way long Options benefit from limited downsides and unlimited upsides.
ETOs for major indices, such as the S&P 500, exist for investors who want to trade a diversified portfolio of stocks rather than individual stocks.
Many Strategic Alternatives
ETOs enable investors to employ various trading strategies, ranging from simple to complex. Through combining options, you can trade under any market condition, be it rising, falling, volatile or flat.
Minimal Initial Investment
When buying ETOs, you only pay a premium and can potentially make a higher return on investment than if you invested in the underlying security directly.
Protect Your Portfolio
Utilise ETOs to hedge your portfolio no matter its size or composition. For example, if you hold a long position in a single stock, you can employ various trading strategies with ETOs to protect it from downside movements.
If you are expecting low volatility, writing (selling) ETOs allows you to benefit from your trading perspective by receiving premium upfront
Unlimited Downsides for Sell Side
While ETO writers receive premium, they are exposed to potentially unlimited downsides as they have the obligation to fulfill the terms. Such positions are characterised by limited upsides and unlimited downsides.
As a leveraged financial product, ETOs carry significantly more risk than their underlying securities. While leverage allows traders to benefit from higher returns, it can also lead to losses greater than the initial investment.
Because ETOs have an expiry date, they are subject to time value. Time value decay is initially slow, but accelerates as the option nears expiry.