CHINA50 Put Warrants: Pricey Options

How do we play the downside move in SSEC Index? One way is to buy CHINA50 put warrants. There are six of them trading in our exchange- from CHINA50-H1 to CHINA50-H6. However it must be noted that CHINA50 index is not the same as SSEC Index. The constituent stocks for SSEC Index (from Wikipedia) & CHINA50 (from FTSE) are listed below..


Table 1: Constituent stocks of SSEC & CHINA A50

We can see below that CHINA50 has been generally rising since October last year. However, it has been dropping in the past 2 months. and it is now testing its uptrend line, SS at 12650.


Chart: CHINA A50's daily chart as at June 25, 2015 (Source: Investing.com)

The list of CHINA A50 put & call warrants are listed below. A quick glance will reveal that these warrants have very high premium. Thus, there are fairly risky.


Table 2: CHINA A50 Put & Call Valuation

Based on high premium, I would advise against trading any of the put warrants of CHINA A50 unless you are a seasoned trader.

Note:
In addition to the disclaimer in the preamble to my blog, I hereby confirm that I do not have any relevant interest in, or any interest in the acquisition or disposal of, any of the indices or instruments mentioned in this post.