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Not an answer but a call for notes: I am looking at SG FX warrants as a safer place to bet than FX futures, but I think that SG FX warrants do not respond to daily or minute by minute fluctuations fast enough, so my thoughts are, its not a good place to scalp or day trade. Anyone out there with confirming experience or other experience.
I trade covered warrants with barclays. they're pretty good to make a quick pound.
I once made a simple bet: FTSE up, Oil down. So I bought some FTSE call warrants and some WTI crude put warrants.
I hade made £150 on an original input of £1000 in a day or two.
But Ive had bad experiences too, like the market's optimism when all the figures point to a sell-off, and so puts have lost money.
I would recommend starting small, but once you get used to it, they can be a very useful instrument.
I once made a simple bet: FTSE up, Oil down. So I bought some FTSE call warrants and some WTI crude put warrants.
I hade made £150 on an original input of £1000 in a day or two.
But Ive had bad experiences too, like the market's optimism when all the figures point to a sell-off, and so puts have lost money.
I would recommend starting small, but once you get used to it, they can be a very useful instrument.
That's going to be SG warrants then that you trade through Barclays. They have some interesting 'Run with the Bulls' warrants at the moment. I'll expand if anyone is interested but seeing as I'm the first person to post here in 2006 (!) I'll wait and see if there's any point.
I am interested in Covered Warrants! I have seen that I can trade SG Warrants with Barclays but I also noticed RBS have launched Covered Warrants. Their spreads seem tighter (see ukmarkets.rbs.com) than SG has anyone had any experiences with RBS Warrants? Any idea why the spreads are so much tighter?
Thanks for the help.
Thanks for the help.
DONEGAL 2007
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I cant say why they are tighter , unless its to get themselves established! I use RBS for Brent and FTSE , but SG for £/€ as I have no option.I used to use SG as the only possibility in the past since the few others packed up , but RBS are certainly a welcome alternative/complement in my opinion!I am interested in Covered Warrants! I have seen that I can trade SG Warrants with Barclays but I also noticed RBS have launched Covered Warrants. Their spreads seem tighter (see ukmarkets.rbs.com) than SG has anyone had any experiences with RBS Warrants? Any idea why the spreads are so much tighter?
Thanks for the help.
RBS have tighter spreads but a lot less leverage (effective gearing). Meaning they are good for short term, even intraday, trading since you lock profit without volatility being too high. But SG's high leverage means you can make a hell of a lot more when the underlying moves significantly.
I have had some very puzzling experiences in respect of Covered Warrant pricing with SG. I've seen it in the past a few times, but due to lack of alternatives I have recently bought SG Covered Warrants again for Brent Crude Dec09. When I bought into the SV03 Call warrants around 9:40am on 15th July, I paid 3.05p. Brent Crude Dec09 was around $64. By the end of the session the same ASK price was 3.30p with BC Dec09 around $64.21. Next day I took a screen capture when the price of Brent Crude Dec09 had risen 49c or 0.76% to $64.70. The gearing at that point was quoted as 9.7. What rise in price did I see...? None. Actually the warrant dropped by 21.79%!! BUT two of the calls rose, both by around 3%. The rise in Brent Cude continued that day reaching $65.14 (up 1.45%) at the point I took another screen capture. The SV03 Calls were still down by 16.99%! Next day, another rise. Brent Crdue Dec09 now priced at $65.79, or +2.46% from the closing price of $64.21 on the day I bought in. With gearing of 9.5 I'd have expected at least a 15-20% gain. In reality the ASK price was sitting at 2.82, down a further 3.61% and down 14.5% from the closing price on that first day.
Today (July 20th) I took another screen capture. The price of BC Dec09 is now way up at $67.91. I called it right, up 6.1% from when I bought in. With gearing in the range of 9 to 11, I'd be expecting the ASK price to be up around 4.2p to 4.9p. Current ASK price...? The same as when I bought in...3.05p!!!! How can that possibly be?
I don't know of any market where the price of an underlying commodity could increase by over 6% while the price of a Call derivitive stands still. Clearly it's time to find an alternative.
If anyone can explain the above, I'd love to hear their theory.
Today (July 20th) I took another screen capture. The price of BC Dec09 is now way up at $67.91. I called it right, up 6.1% from when I bought in. With gearing in the range of 9 to 11, I'd be expecting the ASK price to be up around 4.2p to 4.9p. Current ASK price...? The same as when I bought in...3.05p!!!! How can that possibly be?
I don't know of any market where the price of an underlying commodity could increase by over 6% while the price of a Call derivitive stands still. Clearly it's time to find an alternative.
If anyone can explain the above, I'd love to hear their theory.
I Emailed SG yesterday enquiring about the recent price movements of SV03 relative to Brent Crude itself. Their explanation was the decrease in Implied Volatility. I agree this would be a contributing factor, but I still fail to see how a 6% rise in the price of an underlying commodity over a period of just 4 trading sessions can result in a net movement of zero in such a leveraged product, and that the movement (or complete lack of it) in the covered warrant can be purely down to a decrease in Implied Volatility. If anything, I would expect Implied Volatility to increase significantly give a 6% upward movement in just 4 trading sessions.