Put Option

[revolta]

Any expert can explain how Put Option trade?

For example:
STI 3300BPePW130530
last done price is : 0.051
Exercise Price (SGD) 3,300.0000
Conversion Ratio 1 Unit : 2,000 Warrant(s)
Premium (%) 3.753
Simple Gearing 32.576
Expiry Date b (Countdown) 30 May 2013 (35 days)

Does Put Option commission fee same as commission fee of normal stock?

[ichew]

hi revolta

STI 3300BPePW130530 should be termed a put warrant.
(we shouldnt call it a put option because u cannot short it; altho
technically put warrant is equivalent to a long put option)

yes, warrants r traded like stocks with same comms structure

so if u buy 1 STI 3300BPePW130530, u r expecting STI to go lower.
the pricing of each warrants place u under the mercy of the market-makers because they will decide on what greek values to use.
eg market can move in your favour but they can say volatility is lower so you can still lose money.

also most importantly note that theta is not in your favor.
make sure you understand this before you buy your first warrant

have fun

[revolta]

I only intend to buy put for insurance, in case market crash, but i feel that i will be playing again warrant issuer.