Winner Fintech TRS

Offering leveraged trading services to clients through the issuance of (Total Return Swap) products

TRS

Winner Fintech offers leveraged trading services to its clients through the issuance of (Total Return Swap) products. Customer injects a certain amount of principal as the basis, Winner Fintech will buy and sell the specified range of stocks for the customer according to the agreed leverage ratio of up to 3 times. Finally, the customer will get the return from the leveraged stock investment, and Winner Fintech will get the capital return amplified by leverage.

Legal framework

All investors are required to first establish a client relationship with Winner Fintech and sign an ISDA Master Agreement and an income Swap Partnership agreement with Winner Fintech as a counterparty.

Service characteristics

In the regulatory environment of deleveraging on the mainland, overseas income swaps offer clients an alternative investment route. The income swap under ISDA agreement is already a mature trading mode in the world. The trading structure is relatively simple, similar to the income swap structure under SAC in China. It is also easy for customers to understand and can meet the financing needs of customers.

Introduction of advantages

It can enable investors to increase the investment return of the asset through capital leverage without directly holding the domestic asset overseas

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Offshore delivery

Earnings are directly settled and delivered overseas
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High leverage

Low actual capital usage
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Information confidentiality

The main investors are investment companies/funds

Comparative advantages of income swap structure

Compare margin trading in Hong Kong Compare domestic income swaps
Wider scope of subject matter: For northbound Shanghai/Shenzhen Stock Connect trading, the subject matter of margin trading is to purchase the underlying securities for financing on domestic exchanges. Income swap transactions are only required to be under the Shanghai/Shenzhen Stock Connect.
Less restrictions on hedging transactions: domestic self-trading hedging has a variety of hedging transaction restrictions, including trading volume, hedging price, intraday trading, hedging suspension, etc. There are relatively few restrictions on offshore proprietary hedging.
More funding options: Margin trading is funded by Winner Fintech. In addition to the company's Treasury Department, Winner Fintech can also enjoy a greater choice of funding sources and a lower cost of capital by conducting back-to-back transactions with other financial institutions.
More currency options: domestic income swaps are not allowed to carry out financing transactions; Overseas can choose Hong Kong dollar with lower interest, the client's capital cost can be lower, but the client may bear foreign exchange risk.
Transparency of shareholding disclosure: Through margin account trading, the legal ownership of the underlying stock belongs to the investor, and the investor will be included in the scope of shareholder disclosure. Legal ownership of the underlying shares in the income swap transaction belongs to Lion International and investors will not be included in shareholder disclosure.