Amid global economic volatility and ongoing pressure from U.S. interest rate directions on markets worldwide, the Thai stock market is gaining attention as an appealing "safe haven."
Although the index remains volatile, the relatively affordable stock prices and attractive dividend yields lead many to believe that if international tensions ease, foreign capital inflows (Fund Flow) will be a crucial factor in driving the index higher in the near future.
In a market ready to swing with every piece of news, having a flexible investment strategy is essential for today's investors, and currently, Derivative Warrants (DW) are a financial tool that meets this need.
They are not only weapons for speculative investors seeking exponential returns but also serve as excellent "shields" for managing portfolio risk during periods of intense market volatility.
Jenwit Chinkulkitniwat, Managing Director of the Derivatives Business at KGI Securities (Thailand) Public Company Limited, said that currently, KGI holds about 70% of the DW market share, driven by increasing speculation on large-cap stocks and the SET50 index. He believes investors are satisfied with their liquidity management, though new issuers entering the market could increase competition, with around 4-5 serious competitors currently active.
KGI's key strength lies in risk management, which is the core of the DW business. Maintaining market share requires ongoing investment in computer systems, liquidity management, and product development tailored to all investor segments.
Moreover, KGI benefits from major shareholders from Taiwan with extensive experience in the DW business, providing know-how, technological support, and foreign investment, enhancing their competitive edge.
They also emphasize a “Localization” strategy by engaging Thai investors through advisory teams and building familiarity within the local investor community to deliver superior service compared to competitors.
Current DW investor behavior shows more young investors entering the market, favoring high-risk, high-leverage DWs to seize opportunities for rapid short-term returns.
Jenwit added that the company plans to issue over 1,100 new DWs, with about 20% referencing indices and 80% referencing individual stocks, focusing on covering as many SET100 stocks as possible. In the second quarter of 2026, they plan to issue around 300 DWs and have already issued approximately 70.
Simultaneously, the company strives to offer DWs that better meet investment needs concerning remaining lifespan (Time Decay), leverage (Gearing), and selecting underlying assets suitable for market conditions.
However, the company aims to communicate through the "DW13" product that DWs are not merely speculative instruments but can also be used for risk management and portfolio protection during crises or high market volatility.
Jenwit said the overall Thai stock market still has potential to rise this year, estimating a base index range of 1,100-1,300 points. He sees surpassing 1,500 points as achievable if economic conditions and Fund Flow improve like they did earlier and late last year.
Key factors to monitor include U.S. interest rate trends, the U.S. dollar exchange rate, and 10-year U.S. Treasury yields, all of which influence global capital movements.
He noted that if the U.S. maintains high interest rates and technology stocks continue to rise, it could increase the risk of a sharp correction in international markets, potentially leading some capital to flow back into the Thai stock market.
“The market has already priced in much bad news, while the volatility index (VIX) is stabilizing. Attention should be paid to oil prices, but from Thailand’s perspective, we still believe the Thai stock market is stable and can serve as a safe haven during periods of high volatility abroad.” Jenwit added,
he also sees the Thai stock market as attractive due to its affordable stock prices, low price-to-earnings ratios compared to many countries, and solid dividend yields. These factors will attract Fund Flow in the future. Investors who can time capital inflows well will find significant investment opportunities.
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