Category: Money tips Release Date: 2006-10-05
Recently, the Shanghai and Shenzhen to adjust further intensified Wednesday the two cities there was even a sharp decline in the early Jiancang investors have shipped, the market situation of panic selling, most large-cap stocks fell more than 5%.
In the shock of the market conditions, investment in warrants to buy are shares of more than direct the flexibility and maneuverability. In fact, can be further integrated long-term and short-term two kinds of strategies to cope with the current volatility in market conditions, one being in the bullish stock under the premise of selecting the appropriate warrants, if shares are being pulled, warrants effectively leverage the benefits under the greatly enlarged More than being Unit; two is that once the judge find that the market with their departure from the C of E T +0 trading mechanism to allow investors to realize profits or stop a timely departure.
State Power JTB1 and long electrical CWB1 is a good example. Wednesday, Thursday opened big city, then down, Yangtze Power had once gone against the tide rose, its warrants under the impetus of the underlying shares pulled up sharply, but fell sharply, dragged down by the market, Yangtze Power fell 5.36% to finally close. If you used to chase the investors at the open when they Jiancang, then the day after Jiancang Jibei stuck and suffered losses of more than 5% of the float, investors sell at a loss or a patient faced with the dilemma. However, if investors chose a long power CWB1, the situation is different, the same day in a long process of being pulled stocks soaring electricity CWB1 morning, the biggest increase of more than 6.5%, the afternoon took a significant dive, this time, investors see the potential not still be able to leave the ship immediately, if the only earnings before the set point lower than 6.5%, while investors have a profit of income. From the day of the performance of long-term electricity CWB1, many investors have to operate in the use of this strategy. Hence, compared to positive stock selection warrants give investors more room for maneuver.
The key to this strategy, although the big city, more volatile, but bullish in the long term its ordinary shares, select the corresponding low-premium warrants high leverage, combined with days of repeated short-term trading techniques operation, get unexpected results. From another perspective, is bullish stocks, even if not do short-term operation, such a low premium on high-leverage the same time, both the time value of a certain species, from the long-term it is also safer. Therefore, it can be said is a move forward and attack or retreat and defend strategy.
Of course, this strategy to investors, trading experience and skill requirements higher, for more professional investors, the face of market volatility, investors in the process warrants transaction, should pay attention to with their own risk tolerance and strict set stop-loss point and the only profit point, just leave.
