I just started trading with warrants and I would like to know if I buy a warrant with a strike price of R115 (e.g SBK) but the share price is currently at R100, how does it work when purchasing a vanilla call warrant? Do I only start getting a profit once the the share price goes above R115 or because I bought the warrant when the price was at R100 and as it goes the warrant will also go up. Hope I make sense.
Thank you.. I'm in Cape Town and unfortunately there aren't any Warrant courses coming up soon but will definitely book asap. As for the online course I checked it out and doing a lot of research before getting into warrants. Been trading shares for the last year and half and want to expand my knowledge as well as to make profits more efficiently.
Dear argentino....listen carefully.WARRANTS SUCK INSATIABLY.If you wanna do derivatives.Do CFDs'....CFDs.Those warrants are complicated,time-sensitive freakshows.You have been warned.Otherwise,your wallet will be emptied for U.###And on that Sentinel-note, this is my last post....and a prosperous 2011 for all.Adios.
Yes it does go up as the share price goes up BUT all warrants loose value as time goes on. Thus the share price needs to go in your favour quicker than the warrant time frame. Because of this GLD is a terrible share to trade using warrants as it goes nowhere slowly. Rule for warrants: be greedy, take profits whenever possible.