Here’s my experience buying my first warrant. I don’t fully understand it, and I’ve only spent money I can afford to lose, in an attempt to learn as much as possible.<\/p>\n
I picked the stock I knew best: TSLA.<\/p>\n
I picked the simplest option, buying a call. I guessed the stock would keep going up and bought TSLA0I 2000SG in August.<\/p>\n
The stock did a split, and the warrant changed to TSLA0I 400SG as well.<\/p>\n
As I’m writing this, the expiration date is tomorrow and the stock is at 441 USD. My gut instinct says I’m in the black, that I should get a payout of 441-400 = 41 per warrant, a solid profit. But it seems I missed a lot along the way. I’ve talked to customer service at Avanza, Sparbanken, and Soci\u00e9t\u00e9 G\u00e9n\u00e9rale to get smarter on this. Sparbanken told me it was as simple as pressing “sell” and choosing the number of warrants to sell. The only problem was that I wouldn’t even come out ahead doing it that way, so something felt off. At SG they told me it’s not as simple as calculating underlying price minus strike price = profit. SG’s representative suggested Mini Futures instead, where the warrant’s value tracks a share’s value more closely, at a 1:1 ratio.<\/p>\n
I’m glad I at least predicted the stock’s value correctly, but disappointed that I didn’t understand how the warrant is affected by swings. I also learned that it was easier than I thought to redeem the warrant early if you don’t want to wait until the expiration date.<\/p>\n
EDIT 2: I’ve also read up on “time decay,” which shows how the value of an option (and I’m guessing warrants too) decreases in value over time: https:\/\/www.investopedia.com\/terms\/t\/timedecay.asp<\/p>\n","protected":false},"excerpt":{"rendered":"
Here’s my experience buying my first warrant. I don’t fully understand it, and I’ve only spent money I can afford […]<\/p>\n","protected":false},"author":3,"featured_media":5896,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"site-sidebar-layout":"default","site-content-layout":"","ast-site-content-layout":"default","site-content-style":"default","site-sidebar-style":"default","ast-global-header-display":"","ast-banner-title-visibility":"","ast-main-header-display":"","ast-hfb-above-header-display":"","ast-hfb-below-header-display":"","ast-hfb-mobile-header-display":"","site-post-title":"","ast-breadcrumbs-content":"","ast-featured-img":"","footer-sml-layout":"","ast-disable-related-posts":"","theme-transparent-header-meta":"default","adv-header-id-meta":"","stick-header-meta":"","header-above-stick-meta":"","header-main-stick-meta":"","header-below-stick-meta":"","astra-migrate-meta-layouts":"set","ast-page-background-enabled":"default","ast-page-background-meta":{"desktop":{"background-color":"var(--ast-global-color-5)","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""},"tablet":{"background-color":"","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""},"mobile":{"background-color":"","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""}},"ast-content-background-meta":{"desktop":{"background-color":"var(--ast-global-color-4)","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""},"tablet":{"background-color":"var(--ast-global-color-4)","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""},"mobile":{"background-color":"var(--ast-global-color-4)","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""}},"footnotes":"","_links_to":"","_links_to_target":""},"categories":[1],"tags":[],"class_list":["post-2041","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-general"],"_links":{"self":[{"href":"https:\/\/chromatic.se\/en\/wp-json\/wp\/v2\/posts\/2041","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/chromatic.se\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/chromatic.se\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/chromatic.se\/en\/wp-json\/wp\/v2\/users\/3"}],"replies":[{"embeddable":true,"href":"https:\/\/chromatic.se\/en\/wp-json\/wp\/v2\/comments?post=2041"}],"version-history":[{"count":10,"href":"https:\/\/chromatic.se\/en\/wp-json\/wp\/v2\/posts\/2041\/revisions"}],"predecessor-version":[{"id":5948,"href":"https:\/\/chromatic.se\/en\/wp-json\/wp\/v2\/posts\/2041\/revisions\/5948"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/chromatic.se\/en\/wp-json\/wp\/v2\/media\/5896"}],"wp:attachment":[{"href":"https:\/\/chromatic.se\/en\/wp-json\/wp\/v2\/media?parent=2041"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/chromatic.se\/en\/wp-json\/wp\/v2\/categories?post=2041"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/chromatic.se\/en\/wp-json\/wp\/v2\/tags?post=2041"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}