Do not participate in warrant investment now

Shanghai Securities News reporter Li Dao

The host, Mr. Zhang, said:

On Monday, Shenzhen Stock Exchange also joined in the warrant boom, with three warrants including Ansteel, Vanke and Steel Vanadium making their debut in Shenzhen Stock Exchange. In just one month, T+O and warrants have become the most frequently used trading terms in the current stock market, while warrants

With its quick and intuitive earning effect, it has become the most popular trading variety among investors. From the experience of mature warrant market, the risk of warrant is far higher than that of stock investment. So, what are the basic rules of the game that investors who want to enter the warrant market now should know before investing? What should be paid attention to during operation? How to get more profits in the warrant market while avoiding risks to the greatest extent? To this end, our reporter interviewed two senior warrant experts. Let's listen to their opinions.

　　 Warrants are not suitable for all

As for whether the warrant market, which is full of opportunities and risks, is suitable for all investors, experts have a clear view that the warrant market is not suitable for all stock investors. In this regard, Jinxin

For investors who have not yet entered the warrant market, before entering the warrant market, they must first understand the original meaning of warrants. Wu Yuping said that the essence of warrants is a financial leverage tool based on the future changes of equity, so warrants are actually just to further increase the volatility of equity, thus expanding the income that investors may obtain. Therefore, from this point of view, the premise of investment warrants is to judge the positive shares. Compared with the fundamental analysis of the positive shares, the value of the warrants mainly comes from the volatility of the positive shares and the time value, but what the market sees at present is only a speculation based on the time value, and there is no significant correlation for the volatility pricing of the warrants.

　　 Making money with warrants requires both rationality and speculation

If you want to make money by warrants, you must rely on rationality and speculation. Wu Yuping believes that investors who want to participate in warrants at present should not only see the sudden wealth effect of warrants, but also see the huge risks contained in the warrant market. Because the current market speculation on warrants is mainly aimed at their time value, and the risk of simply speculating on the concept of time before the expiration of warrants is very huge, and there have been painful lessons in the history of the mainland stock market. In the mid-1990s, the Shanghai and Shenzhen Stock Exchanges launched rights issue warrants. Due to the imperfect regulatory system at that time, the makers manipulated the market and hyped the warrants crazily, and the price of the warrants was higher than the normal share price. Since then, the market downturn has led to the fact that some of the regular shares that issued the warrants have fallen below the rights issue price, and the warrants have become a scrap of paper, causing heavy losses to investors. In view of the previous lessons, the current management has further improved and strengthened the regulatory system, but the speculative nature of the warrant market is unlikely to disappear completely. In the future, with the further increase of the variety and scale of warrants, the return of warrant prices will eventually be realized after they are out of the reasonable range, and the false prosperity will not be sustainable. In this regard, investors who have not yet joined the warrant market must recognize this fact.

For some investors who advocate value investment, Wu Yuping especially cautioned that if investors who advocate rational investment do not have warrants in their hands now, it is better to look at the current craziness of warrants from a distance. It is safer to enter warrants after they are highly correlated with the trend of positive shares.

　　 Disclosure of expert warrant operation process

Once the decision is made to intervene in the warrant market, the experts specially remind that the relevant operating procedures must be strictly followed. Wu Yuping said that the best time for warrants to enter the market is when the positive shares are expected to rise (or fall) sharply in the short term. Only when the warrants can play their small and broad characteristics to the extreme. If there is no clear judgment on the positive shares, and you do not expect the positive shares to rise or fall, then even if the warrants are cheap, you should not invest in the warrants rashly. If only positive shares are expected to rise, but it is difficult to judge the rise and duration, you should not easily intervene in warrants, because you are likely to buy the wrong warrants.

As for the investors who receive warrants, they have no risk, but have the right to obtain potential income. Therefore, experts suggest that they might as well wait and see after the listing of warrants. Wu Yuping explained four principles in detail: 1. Generally speaking, on the day when the warrant is listed, because the price is relatively low compared with the stock, it can generally rise or fall directly. Therefore, investors holding warrants can generally hold warrants temporarily on the first day of listing. After entering the continuous trading time, investors can take comprehensive consideration according to the circulation share, absolute price of warrants and the circulation order of corresponding positive shares. 2. Generally speaking, the smaller the circulating share of warrants in the initial listing, the greater the chance of capital driven rise and the easier it is to be targeted by the main speculators. 3. In addition, if the guiding reference price of warrant listing is lower, the probability of its rise is greater. The smaller the number of tradable shares corresponding to the warrants, the greater the opportunity for the warrants to obtain speculation. 4. In addition, for different warrants, warrants with long duration are also easy to be hyped. With the above four operating principles in mind, investors can calmly cope with various changes that may occur in the market.

These principles are good advice for investors who have not yet entered the warrant market. What details should investors who have already participated in the warrant market pay attention to? In this regard, Jiang Yuyan of Guotai Jun'an New Product Development Department believes that the first thing to do is to clarify a mistake in warrant trading. Do not hold warrants overnight.

　　 Warrants need not avoid positions overnight

As warrants are traded in the T+0 mode, there has always been a saying in the market that "warrants cannot last overnight". Jiang Yuyan has different views on this. She believes that for the current warrant market, investors need not rush to sell warrants on the same day, because the current price of warrants is mainly determined by market supply and demand, and the rule that "the time value of warrants gradually decreases with the approaching maturity date" is not applicable for the time being. If investors think that the next trading day may be higher, there is no need to increase the transaction costs in vain. In addition, judging from the recent active Baosteel warrants, there are relatively many high opening times the next day, and the full adoption of T+0 may also miss many opportunities. It should be noted that for the warrants that can be created, if a large number of newly created warrants are listed on the next trading day, investors should still sell them as soon as possible.

In the mature warrant market, the daily decrease of time value of warrants will be better reflected, especially for those warrants near the maturity date, the time value will decline faster, and investors should try their best to hold short-term positions. In addition, short-term positions can also reduce the risk caused by changes in implied volatility of warrants.

　　 How to grasp the T+0 trading opportunity of warrants

One of the main reasons for the popularity of warrants is that they implement the T+0 trading mode, which is different from the A-share market. So, how to accurately grasp this relatively unfamiliar trading mode is particularly important, which is also a topic of great concern to many warrant investors. Jiang Yuyan believes that it is impossible to give a clear answer to how to grasp the T+0 trading mode, because, At present, T+0 profitability mainly depends on the use of technical analysis on the intraday trading of warrants, including three factors: price, volume and time. The same technical analysis method may have completely different effects for different investors, not to mention the technical analysis itself is difficult to say which is more effective. Therefore, Jiang Yuyan suggested that for small and medium-sized retail investors with low level of technical analysis, if they cannot accurately grasp, they should try not to make pure T+0 speculation, and even if they do, they must set their own stop loss level that they can bear.

　　 Create warrant lagging transaction to provide hedging opportunities

In order to curb the excessive speculative atmosphere of warrants in the early stage, the Shanghai and Shenzhen Stock Exchanges have recently launched the creation of warrants system. The Shenzhen Stock Exchanges have also made restrictions on the total number of warrants that can be created, clearly stipulating that warrants created on T day can only be sold on T+2 days and other measures. In this regard, Wu Yuping suggested that warrant investors should pay more attention to these rule changes, and find clues of the main force when speculating in warrants, so as to control investment risks.

　　 Pay close attention to the reform of trading system

Among the three warrants listed in Shenzhen Stock Exchange on Monday, Shenzhen Stock Exchange introduced the market maker system for the first time and stipulated that the information disclosure of warrants will be more timely. In addition, on Friday, the Shenzhen Stock Exchange also supplemented the regulations, limiting the total number of warrants that can be created, and clearly stipulated that warrants created on T day can only be sold on T+2 days. In this regard, Jiang Yuyan believes that a series of policies and measures issued by the management department are intended to further warn investors of risks and urge warrants to move closer to a reasonable range of fluctuations as soon as possible. In addition, Wu Yuping also reminded investors that they should take seriously the 100% regulation of the underlying securities subject to restrictions on sales.

　　 How to prevent risks when the warrant market expands

Jiang Yuyan believes that with the expansion of the warrant market, the future warrant price will be mainly determined by the market supply and demand, so she suggests that investors must pay close attention to the changes in the supply and demand of warrants. The first concern is whether there are new creation warrants on the day of warrants. In addition, investors must also strictly follow the stop loss principle, especially with put warrants, investors must learn to correct immediately when they find the wrong direction, and reverse operation should be much better than covering positions.