Premium rate is one of the data to measure the risk of warrants.
The higher the premium rate, if investors want to protect their capital, the higher the change range of the underlying asset price in the investor's favorable direction, and the higher the risk. Simply put, investors can regard the premium rate as one of the investment costs.
Calculation formula of insurance premium rate:
Subscription Warrant Premium Rate = (Subscription Warrant Price+Exercise Price? Exercise ratio-the price of the underlying asset? Exercise ratio)/(Price of the underlying asset? Exercise ratio)? 100%
Put warrant premium rate = (put warrant price-exercise price? Exercise ratio+price of underlying assets? Exercise proportion)/(the price of the underlying asset? Exercise ratio)? 100%
Extended data:
explain
The exercise price of a warrant is 50 yuan, the current warrant price is 1 yuan, the current share price is 45 yuan, and the exercise ratio is 1: 1. In the formula, the premium rate of the subscription card is 1.3%, that is, if the investor holds the stock until it is sold at maturity, the stock must rise by at least 1.3% before the investor can protect the capital.
The premium rate reflects the risks faced by warrant holders, so it is an important indicator to measure the investment risks of warrants. Other things being equal, if the premium rate of the subscription card is higher, the total price of the subscription card will be higher when it is exercised, so the price of the underlying assets needs to rise sharply compared with the current price to break even.
If the premium rate of put warrants is higher, the performance price will be lower, so the price of the underlying assets will drop sharply compared with the current price to protect the capital. Therefore, the risk of holding high premium warrants is also high.
Generally speaking, warrants with more remaining days have higher premium rate, while warrants with fewer remaining days have lower premium rate. Therefore, when analyzing the investment risk of warrants through premium rate, warrants should have similar remaining days.
The price of put warrants outside Shenzhen market shows the following main characteristics:
A. The premium rate is relatively high: since the theoretical price of these out-of-depth put warrants is zero, it is extremely unlikely that the stock will plummet below the exercise price in a short time. Therefore, these deep-priced put warrants only have the remaining time value. Therefore, its premium rate is high, mostly above 40%;
B, extremely insensitive to the performance of the stock: Similarly, it is extremely unlikely that the stock will plummet below its exercise price in a short time, so its trend performance is basically irrelevant to the stock;
C, the price is relatively stable, showing a slow downward trend: with the passage of time, the time value of warrants is decreasing. So the premium is higher than the original price, and the percentage is the premium rate. In fact, it is the increase. On Saturday, the IPO price was 18 yuan, which was the smallest increase on the first day of listing, so the premium rate was the lowest.
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