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Professional · Lesson 6 of 8

Warrants, CFDs and structured products

8 minute read · By Krishna Avadhani, Vestora Academy · Updated 18 October 2026

Warrants are option-like securities issued by banks or companies and traded on an exchange. Company-issued warrants create new shares when exercised. Bank-issued trading warrants, instalment warrants and MINIs exist on some markets; check each product disclosure statement.

Contracts for difference (CFDs) pay the difference in an asset's price between opening and closing, with leverage and overnight funding costs. ASIC introduced product intervention orders in 2021 limiting leverage for retail CFD clients, after finding most retail clients lost money. CFDs do not pass the Vestora safety rule.

Structured products package bonds and options, for example capital-protected notes or autocallables. They can be complex and costly, with risks hidden in issuer credit, liquidity and early-redemption terms.

Key takeaways

  • Warrants: exchange-listed, option-like.
  • CFDs are leveraged; most retail CFD clients lose money.
  • Structured products bundle bonds and options; read the fine print.

Check your understanding

1. Why did ASIC restrict retail CFD leverage in 2021?

  • CFDs were too cheap
  • Most retail clients were losing money
  • They were tax free
  • Banks requested it
Show the answer

Most retail clients were losing money. ASIC found significant retail losses.

2. A capital-protected note is usually built from...

  • A bond plus an option
  • Only shares
  • Gold
  • A CDS
Show the answer

A bond plus an option. The bond protects capital; the option gives upside.

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General education only, not financial advice. Examples are illustrations. Rules, tax settings and products change; check official sources.