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Be careful when trading warrants


http://finance.sina.com.cn 00:00, April 25, 2006 China Securities Network - Shanghai Securities News

Miss Zhang:

How to buy and sell call warrants and put warrants? How can I make a profit? Is the operation the same as the stock?

I don't understand the put option, as well as the exercise price and duration. Could you briefly explain it? Thank you. Lao Wang

Mr.Wang:

The brief answers to your questions are as follows:

The buying and selling of call warrants and put warrants is basically the same as that of stocks. The lowest one hand, that is, 100 shares, is a unit, and only a commission of no more than 3 ‰ but no stamp duty is charged. It is difficult to answer the question of how to operate in order to make a profit. Although it is simple in theory to sell high and absorb low, it is difficult in practice. According to the current situation of warrant traders in Hong Kong and the mainland of China, 70% of warrant participants are in a loss state, and the risk that the warrant trading price may be zero on the exercise date may occur.

The exercise price means that the warrants held by the investors can be sold to the company within the exercise period at the purchase price set by the listed company issuing the warrants. The duration is relatively simple, that is, the date when the warrants are available for investors to trade in the market. Once the duration ends, trading will stop. At present, the duration of most warrants in the market is about one year. Vanke ( information quotation forum ) The shortest warrant is 9 months, while Valin warrants ( information quotation forum ) The maximum is 24 months. Miss Zhang


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