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The resumption of warrant trading in the mainland stock market is new and unfamiliar to most investors. As warrant is a high-risk finance with leverage effect negotiable securities Products, and the warrant terms contained in the share reform plans of each company are different, so investors should pay attention to the following issues when choosing the warrant investment:
(1) We must carefully analyze the deep meaning of warrants in each consideration scheme. along with Non tradable shares With the comprehensive implementation of the reform, more and more companies will include warrants as a derivative product in their share reform plans
Therefore, the share reform plans are different, and the extended warrants have different meanings, which means that the nature of the results caused by the exercise of warrants is different. Investors should accurately grasp the meaning of each consideration plan, which will help investors control risks and increase returns.
(2) It should be avoided to invest all funds in warrants. Warrants belong to higher risk varieties and cannot equate warrant positions with shares From the perspective of position, it is particularly important to avoid investing all funds in warrants. Otherwise, if you are lucky, the profit will be considerable, but if you misjudge the direction, the loss will be relatively large.
(3) Pay attention to the timeliness risk of warrants. The investment value of warrants includes intrinsic value and time value. The time value will decrease with the maturity of warrants approaching. The result of long-term holding is likely to be the ultimate loss of all royalties. Therefore, the warrant has timeliness and duration, generally ranging from three months to two years. If the warrant does not have the exercise value at the expiration, the investor will lose all of its premium.
(4) Investment warrants should strictly follow the stop loss principle. Once they fall below the stop loss level, they should exit in a timely manner. They should not wait for unwinding or try to reduce costs by covering positions at a low level. The reasons for strictly abiding by the stop loss principle are as follows: first, when the warrants are outside the deep price, their price sensitivity will be greatly reduced. Unless the underlying securities rebound significantly, there is little possibility of unwinding; Secondly, the value of warrants will decrease with the passage of time, so waiting for passive positions is often more than rewarding.
(5) When investing in warrants, one should not covet temporary bargains. Don't buy just because the price of a warrant is extremely low. For some warrants whose price is only a few cents, there is usually a great risk. Because after the expiration of the warrant, the value of the warrant will be zero, and investors will lose all the principal.
(6) Do not invest in warrants if you cannot always pay attention to changes in the market. Warrants are more suitable for short-term investment, and the holding time should not be too long. Because it is fundamentally different from stock investment, it is not suitable for buying warrants. Since the price of warrants tends to fluctuate sharply, it is necessary to pay close attention to the price trend of underlying securities and warrants themselves after buying warrants. If investors cannot always follow the order, they should try to avoid investing in warrants.
Author: Huang Yanbin
(Source: Shanghai Securities News)
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.
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