Gate.ioBlogGate.io Quick-Fire Questions on Warrants
Gate.io Quick-Fire Questions on Warrants
26 May 13:57
Q: What is a warrant? A: A warrant essentially is an option in which investors, as buyers, purchase a call/put warrant from the issuer. Before the expiration date, investors are free to buy and sell according to market conditions, capturing the return from the increase/decrease in the price of the target asset.
Q: What are call warrants and put warrants? A: These two types of warrants represent investors’ view of the future market trends. If you are bullish about the futures market, you can purchase a call warrant; if you are bearish about the futures market, you can purchase a put warrant.
Q: What kinds of markets are suitable for warrants trading? A: When the market is volatile, choosing warrant trading can earn both increases of target asset and bring a positive impact
so that you can earn both the upside of the target asset and the positive impact of the rise in implied volatility.
Q: Who is suitable for warrants (warrants) trading? A: Investors with some investment experience or those who prefer medium to high risk can also trade warrants. Also, if you are a novice trader, you can try out the Gate.io Warrants (Warrants) Demo Practice Room because of the simple and easy-to-understand principles of warrants trading.
Q: What is the difference between Warrants and CBBC?
Q: Which is more suitable for new traders, CBBCs, or warrants? A: CBBCs are not affected by time value and implied volatility, and the focus is more on the recovery price, which is more similar to the price of the target asset, so the structure of CBBCs is relatively more “”simple and brutal”. In contrast, the nest egg has a time value, and the further away from the maturity date, the higher the value, and is also affected by the implied volatility, but the nest egg does not have the risk of forced recall, so it is relatively less risky.
In fact, both of them have different risks and returns depending on the market situation and different rules. The most important thing for new traders is to understand the characteristics of both products and operate them flexibly to get the results you want.
Recently, Gate.io has already launched a number of BTC warrants trading in simulation zones, waiting for you to explore!
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