New CFDs are allocated on the Ex-date. Clients with short positions will be debited and clients with long positions credited.
Capital gain distribution
Cash payment is allocated on Ex-date for value Pay date.
Cash adjustments are booked on the Ex-date reflecting the market price movement on the Ex-date, but the actual value of the payment will be settled on the Pay Date.
For long CFD positions, a Return Adjustment is subtracted from the Cash Adjustment. The Return Adjustment is designed to mirror the cash-flow from the default withholding tax rate in the relevant market for the underlying dividend payment.
Deletion of Open Orders as a Result of Corporate Actions
The day before a Corporate Action event is scheduled to take effect (the Ex-date), open orders are deleted for certain event types.
The following details the rules of behaviour:
|Event Type||Never delete orders||Always delete orders||Rule defined below|
|Reversed stock split||x|
For dividends and rights issues, all open orders for the given instrument will be deleted if the change in the market price is calculated to be over 20% due to the Corporate Action event.
Dividend reinvestment plans (DRIP)
CFDs will receive the cash payment. The cash adjustments on CFD positions are booked on the Ex-date reflecting the market price movement on the Ex-date, but the actual value of the payment will be settled on the Pay date.
Dividends on index trackers
When any underlying stock that is part of an Index CFD goes ex-dividend, the Index CFD will be price adjusted to reflect this dividend. The weighted proportion of the applicable dividend within the Index CFD will be credited to the client's account for long positions and debited for short.
Please note that the DAX30 is a Total Return Index, meaning the index is automatically adjusted for dividends.
Index Dividend = Share Dividend * Shares in Index / Index Divisor*.
* Divisor: an amount used to stabilise the index value when its composition changes. The sum of all index members' prices is divided by the divisor to achieve the normalised index value. The divisor is adjusted when capitalisation amendments are made to the index members, allowing the index value to remain comparable at all times.
To prevent the value of an index from changing due to such an event, all corporate actions that affect the market capitalisation of the index require a divisor adjustment to ensure that the index values remain constant immediately before and after the event.
Holdings in the liquidated company will be removed. Liquidation proceeds, if any, will be allocated.
Mergers & Mergers with Election
For mandatory mergers, clients holding CFD positions are paid cash, new CFDs or both on the Ex-date according to the terms of the corporate action. Clients will not have the possibility to vote on mergers with elections. The default term will be elected on behalf of the client.
Mergers are paid according to the below, depending in the outcome of the event.
- Cash (distributed on Pay-Date)
- Stocks (distributed on Ex-Date)
- Mix of Cash & Stocks (distributed on Ex-date)
CFDs will receive the cash payment. The cash adjustments on CFD positions are booked on the Ex-date reflecting the market price movement on the Ex-date, but the actual value of the payment will be settled on the Pay Date.
Positions in instruments that are not online tradable
It can happen that a Corporate Action involves an instrument that is not tradable online with Saxo Bank. In that case CFD positions in new instruments that are not tradable online are, if possible, liquidated. The proceeds are paid in full to clients.
Rights are granted and booked in accordance with the ratio on the Effective Date (Ex-date) and automatically orders for sale of the rights are placed when the relevant market opens for trading. Following the order executions proceeds from the sold Rights are booked to the client’s account.
In case the client wishes to participate in the Rights Issue, this is possible by buying the actual Stock Rights.
New CFD positions in the original instrument are granted and booked according to the ratio and the price of the underlying rights issue on the Effective Date (Ex-date), with the value date as payment date.
Australian Listed Events
For certain event types including but not limited to Non Renounceable Rights Distributions, Subscription Offers, Entitlement Offers, Rapid Offers, Retail Offers, Australian Listed Companies have the right to reduce entitlements to zero in certain circumstances and Saxo Bank will therefore only be booking entitlements to clients on the Payment Date.
Note that Since March 2009 it is the policy of the ACSA (Australian Custodial Services Association) not to offer Share Purchase Plans Events (SPP) to underlying beneficial owner clients and thus Saxo Bank cannot participate in such events.
Cash payment is allocated on Ex-date for value Pay date.
CFDs positions on the underlying Stock are allocated on the Ex-date. Clients with short positions will be debited and clients with long positions credited.
CFDs are allocated on the Ex-date for value on Pay Date. Clients with short positions will be debited and clients with long positions credited.
Stock Splits / Reverse Stock Splits
New CFDs positions are allocated on the Ex-date.
Special Corporate Action Events
Special and infrequent Corporate Actions that do not come under the descriptions above may occur.
Saxo Bank will handle such Corporate Actions in the best interest of the client to the extent that time and operational procedures will allow.
Clients holding CFD positions will not be given a choice to tender.
Updated 30 September 2015