After a year of operation of the warrant market, it is believed that investors have a basic understanding of warrants. However, before formally participating in the trading of warrants, it is advisable to refer to the mistakes often made by ordinary novices listed in this article to avoid repeating the mistakes and causing unnecessary losses.
Lack of risk awareness
The most attractive aspect of warrants is that when investors' buying and selling strategies are correct, the relevant returns will change more than the positive shares; Unfortunately, if you misread the market, the loss will also be several times higher than that of equity, so the risk level is not comparable to that of ordinary investment tools. And the warrant is different from the regular stock, and the price can fall to zero, so the amount invested in the warrant should not be more than the maximum loss that you can accept. In this way, when the market situation is reversed, the losses suffered are still acceptable. Generally, only when there is a clear or strong judgment on the future trend of the market or individual shares, can they enter the warrant market and bear in mind the risk control.
Lower cost
Many investors in the spot market are accustomed to using the average price investment method - constantly increasing the price downward to reduce the loss of misreading the market. However, this strategy is not suitable in the warrant market, and may even lead to the consequences of adding mistakes to mistakes and annihilation. Even if the positive shares rebound, the value of warrants will lose over time, and the loss of warrant prices may be faster. The so-called trade-offs may outweigh the losses. Unless investors have great confidence that the stock price will change in the short term, it is better to directly accept losses and close positions.
It is not settled in time when the target price is reached
The inexperienced novice often refuses to strictly stop the erosion until the warrant expires and becomes waste paper, resulting in huge losses. Therefore, it is better to set the stop position as early as possible to avoid greater losses.
Abiding by discipline and taking the initiative to settle at the target price is also an indispensable skill for investment warrants. In the eyes of every investor, the higher the goal, the better, but it must be reasonable and avoid setting a "sky high price". It is not difficult to determine the target price, as long as the trend of the positive shares is predicted and then calculated according to the leverage ratio of the warrants.
If the purchased warrants are approaching the target price, it is advisable to consider liquidating some positions first. After all, the volatility of warrant investment is strong, which can be regarded as a guarantee of successful profitability. The remaining positions "look while walking", but a new target price must be set as the stop earning standard. As the positive shares reach the target price, it has been indicated that the upward trend has lasted for a period of time, and the opportunities for consolidation or backflow naturally increase. If there is little difference with the new target price, that is, when the upward space is limited, the risk will also increase. Some investors will continue to hold positions in order to expand the potential increase, but only professional or market based investors are suitable for this high-risk strategy.
Investors who have just started to set foot in warrants should make small bets to try to buy and sell them. Only after grasping the basic operating principle can they add a code, but they must still buy and sell according to their own affordability. (Primary dealer Guangfa negotiable securities Liu Siling)
