About Fees and Other Costs

• When engaging in index futures and options trading, transaction fees will be charged according to the rates, amounts, and methods specified in "Fees for Index Futures and Options Trading".
• If you manage positions in our account, no account management fee will be charged.

About Margin

• For index futures and index options trading (short positions), you will need to provide margin calculated by SPAN, excluding any cash shortfalls (as detailed in section 3.(1)). You may use securities (hereafter referred to as "substitute securities") as collateral (refer to "Types of Substitute Securities and Substitute Prices").
• The amount of margin is calculated by SPAN according to the risks arising from all positions in futures and options trading, so the ratio of margin to the amount of index futures and options trading is not constant.

• SPAN stands for Standard Portfolio Analysis of Risk, a margin calculation method developed by the Chicago Mercantile Exchange. Margin amounts are calculated based on the risks arising from all positions in futures and options trading.

About Risks of Index Futures Trading

The price of index futures fluctuates due to changes in the underlying index, which can lead to losses. Additionally, because index futures trading allows transactions that exceed the amount of margin with a small margin, there is a possibility of incurring substantial losses. Therefore, it is crucial to fully understand the following points before starting index futures trading.

Note: When trading futures or options (excluding index options) in the same futures and options account at the Osaka Exchange, the margin for those transactions is calculated and managed as a whole. If there is a margin shortfall due to market fluctuations in non-index futures transactions, additional margin may be required. If margin is not provided by the specified deadline or if certain conditions for loss of benefits are met, positions in index futures trading may be liquidated even if the issue did not arise in index futures trading. In this case, you will also be responsible for any losses incurred from that liquidation.

• If market prices change in the opposite direction of expectations, you may lose most or all of your margin within a short period. Additionally, those losses are not limited to the amount of margin.
• If fluctuations in the index futures market or declines in substitute securities result in a shortfall, additional margin may be required.
• If margin is not provided by the specified deadline or if conditions for loss of benefits are met, you may face liquidation of part or all of your positions while incurring losses. In this case, you will be responsible for any losses resulting from that liquidation.
• The financial product exchange may impose regulatory measures, such as increasing margin requirements or limiting the substitution of margin with securities, in cases of abnormal trading or in the interest of risk management by clearing houses. Consequently, additional margin or substitutions between substitute securities and cash may be required.
• Depending on market conditions, it may not be possible to execute trades as intended. For instance, if market prices reach limit levels, even if you wish to settle through resale or repurchase, it may not be possible.
• Depending on market conditions, the financial product exchange may widen the limit levels, which could result in daily losses exceeding expectations.

About Risks of Index Options Trading

The price of index options fluctuates based on changes in the underlying index, which can lead to losses. Note that there are limitations on the period during which options can be exercised, so caution is required. Additionally, index options may have a greater volatility compared to the actual index, potentially resulting in significant losses. Therefore, it is essential to fully understand the following points before starting index options trading.

• Depending on market conditions, it may not be possible to execute trades as intended. For example, if market prices reach limit levels, even if you wish to settle through resale or repurchase, it may not be possible.
• Depending on market conditions, the financial product exchange may widen the limit levels, which could result in daily losses exceeding expectations.

＜Specific Risks for Buyers of Index Options＞

• Index options are time-sensitive products, and if a buyer does not exercise their rights or resell before the expiration date, those rights will expire, potentially resulting in a total loss of the investment amount. However, the loss is limited to the amount invested.

＜Specific Risks for Sellers of Index Options＞

• Sellers will engage in transactions that exceed their margin, and losses may not be limited when market prices change in the opposite direction of expectations.
• Sellers must provide margin when the index options transaction is established. If a shortfall arises due to market fluctuations or declines in substitute securities, additional margin may be required.
  Note: When trading futures or options (excluding index options) in the same futures and options account at the Osaka Exchange, the margin for those transactions is calculated and managed as a whole. If there is a margin shortfall due to market fluctuations in non-index futures transactions, additional margin may be required. If margin is not provided by the specified deadline or if certain conditions for loss of benefits are met, positions in index futures trading may be liquidated even if the issue did not arise in index futures trading. In this case, you will also be responsible for any losses incurred from that liquidation.
• If margin is not provided by the specified deadline or if conditions for loss of benefits are met, you may face liquidation of part or all of your positions while incurring losses. In this case, you will be responsible for any losses resulting from that liquidation.
• The financial product exchange may impose regulatory measures, such as increasing margin requirements or limiting the substitution of margin with securities, in cases of abnormal trading or in the interest of risk management by clearing houses. Consequently, additional margin or substitutions between substitute securities and cash may be required.
• Sellers are required to comply with any assignments of rights when called upon. This means that when assigned a right, the seller will need to pay the difference between the exercise price and the final settlement value (SQ value), so special caution is necessary.

Index Futures and Options Trading is Not Subject to Cooling-Off

• For index futures and options trading, the provisions of Article 37-6 of the Financial Instruments and Exchange Act do not apply.

About the Mechanism of Index Futures and Index Options Trading

Index futures trading is conducted in accordance with the rules set by each financial exchange.

1. About the Mechanism of Index Futures Trading

   Trading Methods

   1. Target Indices
      The indices available for trading include those designated by financial exchanges, such as the Tokyo Stock Price Index (TOPIX) and the Nikkei Stock Average.
   2. Trading Deadlines
      Index futures trading (excluding dividend index futures) concludes on the trading day before the second Friday of the designated month (adjusted for holidays). Trading final days are organized into "expiration month trades."
   3. Post-Daytime Trading Sessions
      Some sessions after regular trading hours allow index futures trading as per exchange rules.
   4. Strategy Trading
      Index futures allow multiple simultaneous buy/sell transactions (strategy trading) as specified by each exchange.
   5. Price Limit Range
      Each exchange sets limit ranges to prevent unexpected losses due to price volatility.
   6. Temporary Trading Suspension
      A circuit breaker system temporarily halts trading when futures prices drastically increase or decrease.
   7. Trading Restrictions
      Exchanges may take regulatory measures (e.g., margin adjustments) in cases of abnormal trading.

   Settlement Methods

   1. Settlement by Resale or Buyback (Opposite Transaction Settlement)
      Refer to "Example Calculations for Index Futures Trading".
   2. Settlement by Final Clearing Price (SQ Value)
      Unsettled positions are settled based on the difference between the original contract and the final clearing price.

2. Mechanism of Index Option Trading

   Index option trading includes TOPIX options and Nikkei 225 index options, and is conducted in accordance with rules set by each financial instrument exchange.

   Trading Methods

   1. Trading Subjects
      There are two types of trading subjects:
      1. Index Put Option
         This grants the right to receive an amount calculated as the difference when the index value falls below the strike price, multiplied by a number specified by the exchange.
      2. Index Call Option
         This grants the right to receive an amount calculated as the difference when the index value rises above the strike price, multiplied by a number specified by the exchange.
   2. Trading Deadline
      Index options are traded by contract month as defined by each exchange.
      After the expiration of the nearest contract month, a new contract month begins the following trading day.
   3. Post-Daytime Trading
      After the daytime trading session, each exchange may provide an additional session for index options trading. Any margin deposits or pledges related to this session are conducted with the following day’s session.
   4. Strategy Trading
      Strategy trades involving simultaneous buying or selling of multiple options can be conducted within the scope defined by each exchange.
   5. Price Limit Range
      To protect investors from sudden price changes, exchanges set a price limit range (daily fluctuation limit). This may be adjusted by the exchange as needed.
   6. Trading Suspension
      When index futures prices rise or fall significantly, index option trading is temporarily suspended alongside index futures.
   7. Trading Restrictions
      In cases of abnormal trading, exchanges may take restrictive measures, such as:
      1. Narrowing the price limit range
      2. Advancing the margin deposit or pledge deadline
      3. Increasing the margin amount
      4. Restricting the use of securities for margin substitution
      5. Lowering the margin substitution securities haircut
      6. Accepting deposits before the settlement date
      7. Restricting or prohibiting index option trading
      8. Open position limits

   Exercise of Rights

   1. Exercise Date
      The exercise date for index options is only the day following the last trading day.
   2. Exercise Instructions
      Buyers must instruct their broker by the exchange-specified deadline if they intend to exercise their rights on the exercise date.
      If in-the-money options are not instructed for exercise by the deadline, they are automatically considered as exercised unless the buyer explicitly instructs otherwise.
      • "In-the-money" means the strike price exceeds the final settlement value for put options and is below the final settlement value for call options.
   3. Exercise Allocation
      The clearing organization assigns exercised options to the brokers holding open short positions in the specified option contracts, who in turn allocate them to customers.

   Settlement Methods

   There are two methods of settlement in index options trading: selling or buying back the position (offsetting transaction) or exercising the option.

   1. Settlement by Selling or Buying Back (Offsetting Transaction)
      See "Example Calculation for Index Futures Options"
      Investors holding open positions can close them by selling or buying back the position by the last trading day. The buyer receives the sale proceeds, and the seller pays the purchase amount.
   2. Settlement by Exercising Rights
      Buyers can exercise their rights to settle their position. Sellers assigned to the exercised options must pay the amount equal to the difference between the strike price and the final settlement value.
3. About Margin

   1. Margin deposit or pledge
      Margin must be deposited or pledged by the specified date set by the financial instruments business operator if there is a shortfall in the total amount calculated as either the total shortfall amount or the cash shortfall amount, whichever is larger, by the day following the day the shortfall occurred (for non-resident clients, this is calculated from the third day after the day the shortfall occurred).
      Additionally, margin can be substituted with securities, but the amount corresponding to the cash shortfall must be deposited or pledged in cash.
      • Calculated for each futures and options trading account.
      • Total shortfall amount
        The difference when the total margin received is less than the required margin.
      • Cash shortfall amount
        The difference between the cash deposited as margin and the client's expected cash payment.
      1. Required margin amount
         This amount is calculated by subtracting from ① to ② and adding ③ for trades within the same futures and options trading account.
         • Futures and options trading refers to government bond futures trading, government bond futures options trading, index futures trading, index options trading, and security options trading.
         1. SPAN margin amount
            The SPAN margin amount is the amount calculated by SPAN for the open positions in futures and options trading.
         2. Total net option value
            The total net option value is obtained by subtracting the total value of sold options from the total value of purchased options. The values are defined as follows:
            Total value of bought options
            For the option trades where the bought positions exceed the sold positions, the amount is calculated by converting the clearing price to a per-unit amount and multiplying it by the net quantity.
            Total value of sold options
            For the option trades where the sold positions exceed the bought positions, the amount is calculated by converting the clearing price to a per-unit amount and multiplying it by the net quantity.
            • Options trading refers to government bond futures options trading, stock index options trading, and stock options trading.
            • The clearing price is generally determined by the theoretical price set by the clearing organization.
         3. Delivery margin
            Delivery margin is the required margin amount necessary when settlements are made through delivery, as defined by the clearing organization.
            • Delivery margin is calculated only for commodity futures trades that involve delivery.
      2. Total margin received
         Amount of cash deposited as margin + value of substitute securities (market value of securities × collateral rate) ± expected cash receipt/payment from the client.
         • Total margin received is calculated for each futures and options trading account at the financial instruments exchange.
         • Client's expected cash receipt (receipt or payment) amount
           Calculated profit/loss amount (profit or loss based on market fluctuations of futures trading – payout amount of calculated profits) ± profit/loss from futures trades with unresolved settlements with clients ± transaction amounts from options trades with unresolved settlements with clients – amounts the client must bear that the financial instruments business operator recognizes as necessary.
         • The profit/loss based on market fluctuations of futures trading is calculated based on the difference between the newly contracted amount and the clearing value from the previous trading day. If trading occurs in the same futures and options trading account at the same financial instruments exchange, that profit/loss amount is included.

      Note that the required margin amount is the minimum standard set by the clearing organization's rules, and the actual amount is determined by each financial instruments business operator. Additionally, if a financial instruments business operator requests margin deposits or pledges, the client must promptly make the deposit or pledge; otherwise, the financial instruments business operator may liquidate the positions based on the client’s calculations.
      Furthermore, the deposited or pledged margin (excluding the portion equivalent to the client's expected cash payment) may either be deposited directly with the clearing organization or, with the client's consent, partially or wholly substituted with cash or securities held by the financial instruments business operator before being deposited with the clearing organization. In this case, based on the method of deposit (direct or substitution), it will be treated as "transaction margin" or "entrusted margin," but essentially there will be no significant change for the customer.

   2. Payout of calculated profits
      For the amount of money equivalent to the calculated profits related to index futures trading (such as security index futures trading), a client may request a payout to the entrusted financial instruments business operator limited to the difference when the total margin received exceeds the required margin.
      Please note that if a payout of calculated profits is made, it will offset the profit amount when the positions are settled.
   3. Return of margin
      The company will generally return the amount remaining after deducting any unpaid debts from the margin deposited or pledged by the client regarding index futures trading promptly when the client requests a return.

Key Terms Related to Futures and Options Trading and Their Delegation

• Margin (しょうこきん)
  Refers to the collateral deposited or pledged to secure the fulfillment of obligations under futures and options contracts.
• Open Position (たてぎょく)
  Refers to futures and options contracts that have not been settled. Among purchases, those that have not been settled are called long positions (買建玉), and among sales, those that have not been settled are called short positions (売建玉).
• Buyback
  Refers to the purchase conducted to settle (reduce) short positions.
• Resale
  Refers to the sale conducted to settle (reduce) long positions.
• Expiration Month (げんげつ)
  Refers to the month in which the settlement date of the transaction falls. In futures and options trading, multiple expiration months are set for the same product, and trading is conducted for each.

Overview of Financial Instrument Trading Contracts Related to Index Futures and Options Trading

The index futures and options trading at our company is based on the following:

• Intermediation of orders to the market through the domestic exchange's trading system
• Intermediation, referral, or representation in index futures and options trading
• Management of clients' funds or open positions related to index futures and options trading

Overview of Taxes Related to Financial Instrument Trading Contracts

＜Overview of Taxes Related to Index Futures and Options Trading＞

Taxation for individual clients is as follows:

• Profits arising from cash settlements related to index futures trading are taxed separately from other income as business income or miscellaneous income. In the event of losses, it is generally possible to offset against profits from other futures trading, etc.

Taxation for corporate clients is as follows:

• Profits and losses related to index futures and options trading are included in the calculation of income for corporate tax as either income or expenses.

For more details, please contact a tax professional.

Overview of the Financial Instruments Business Conducted by Our Company

The financial instruments business conducted by our company is primarily a Type 1 Financial Instruments Business based on Article 28, Paragraph 1 of the Financial Instruments and Exchange Act. When engaging in index futures and options trading at our company, the following applies:

• In order to conduct transactions, you must fill out the required information on the "Futures and Options Trading Account Setup Agreement" in advance, stamp it, and submit it to our company to open a futures and options trading account. All funds and open positions related to futures and options trading will be processed through this account. Please read the agreement carefully and keep a copy for your records.
• When opening a futures and options trading account, certain investment experience, knowledge, and financial capacity are required, so there may be cases where we cannot accept the opening of an account.
• Orders should be placed within the operating hours specified by our company.
• When placing an order, please specify the trading target, expiration month, whether it is a sale or purchase, order quantity, price (limit order, market order, etc.), and the effective period of the order. If these details are not specified, we may not be able to execute the order. You may also be required to submit an order form.
• When an order is placed, please instruct our company on the type of transaction (new sale, new purchase, resale, or buyback) regarding completed or pending transactions by the time of placing the order or by the designated date. If no instruction is given, it will be assumed to be a new sale or new purchase.
• Once the ordered index futures and options transaction is completed, a "Transaction Report" will be issued by our company for your confirmation.
• Furthermore, after the completion of the index futures and options transaction, until the open positions are settled, a "Notice Regarding Futures Transactions" will be mailed to you monthly to confirm the details of the open positions. Additionally, a "Reconciliation Notice" will be mailed to confirm the balance of claims and debts between you and our company.
• Please ensure to verify the contents of the "Transaction Report," "Notice Regarding Futures Transactions," and "Reconciliation Notice."
• If there are any discrepancies in the reported content, please promptly contact the management officer of our company directly.

Overview of Our Company

Company Name	One Asia Securities Co., Ltd. Financial Instruments Business Operator Kanto Local Finance Bureau (Financial Instruments Business No. 201)
Head Office Location	3F Nisshin Building, 1-6-4 Kudankita, Chiyoda-ku, Tokyo 102-0073
Affiliated Association	Japan Securities Dealers Association
Designated Dispute Resolution Organization	Specified Non-Profit Organization Securities and Financial Products Mediation Consultation Center
Capital	100 million yen (as of October 3, 2022)
Main Business	Financial Instruments Business
Established	February 2001
Contact Information	03-6273-4201

Contact Information for Comments, Complaints, etc.

Address	3F Nisshin Building, 1-6-4 Kudankita, Chiyoda-ku, Tokyo 102-0073
Phone Number	03-6273-4391 Monday to Friday (excluding holidays) 8:30 AM – 5:30 PM

Information on the Financial ADR System

The Financial ADR System aims to achieve a simple and rapid resolution of disputes and troubles between customers and financial institutions through means other than court proceedings. You can utilize the "Securities and Financial Products Mediation Consultation Center (FINMAC)," a designated dispute resolution organization under the Financial Instruments and Exchange Act, for resolving complaints and disputes related to financial instruments business.

FINMAC is a public third-party organization and is not affiliated with our company.

Address	1-1, Kayabacho 2-chome, Chuo-ku, Tokyo 103-0025
Phone Number	0120-64-5005 Monday to Friday (excluding holidays) 9:00 AM – 5:00 PM