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As the warrants of Baotou Steel and Handan Steel expired one after another last month, there are only two steel warrants of Maanshan Iron and Steel and Vanadium Steel in the market at present, and the steel warrants in the market are becoming scarce. In an environment where steel stocks are still popular, will the remaining two warrants become "scarce for expensive"?
We can see that on Monday, steel stocks rose sharply, and both Steel Vanadium and Masteel warrants outperformed the regular stocks, but the premium rate of Steel Vanadium warrants fell to 9.6% from 14% at the end of last week, instead becoming "cheap".
In fact, due to the low degree of leverage, warrants in the deep price should not enjoy too high a premium. If the premium is too high, it is difficult for warrants to maintain the leverage relationship with regular shares, and they are also likely to lose. At present, the premium rates of Steel Vanadium and Masteel warrant are 9.6% and 10%, respectively. Compared with the remaining period of the two warrants, which is up to 1.5 years, the price has become reasonable.
In the bull market, the opportunity to grasp warrants will undoubtedly lead to higher returns, and the investment in steel warrants mainly depends on grasping two key points.
The first point is to judge the trend of steel stocks. Steel stocks have experienced a wave of gains, but from the perspective of dynamic valuation, they are still "depressions", and they are still safe investment products in the medium and long term. At present, steel warrants are separated from separable convertible bonds with a term of up to 2 years, so they are very suitable for long-term investors to participate.
The second point is to measure the value of warrants and compare the leverage of warrants. The reason why investors buy warrants instead of regular shares is to obtain leverage. If warrants cannot provide leverage or leverage is very small, then it is better to invest in regular shares. At present, although the leverage of Steel Vanadium and Magang warrants is small, it is expected that they will still be able to provide returns beyond the normal shares and trade time for space if viewed from the whole warrant period. (East negotiable securities Huang Dong)
Sina statement: The content of this article is purely the author's personal view, only for investors' reference, and does not constitute investment advice. Investors operate accordingly at their own risk.
