Headline: Derivatives gearing up your market
First two paragraphs
EQUITY investors who traded successfully during the past volatile year have reason to smile. Their smiles would be even broader had they backed their views through a position in geared equity derivatives.Derivative players have no shortage of choice across warrants, single stock futures (SSF) and contracts for difference (CFD). For newcomers to the derivative market warrants, the least risky of the trio, stand out as first choice.
"Warrants are the place to start learning ," says Brett Duncan, Standard Bank's director of retail derivatives. "Once you gain experience you can progress to SSFs and CFDs." Standard Bank, the only issuer of warrants listed on the JSE, offers calls and puts on 26 shares, the JSE top 40 index and the New Gold exchange traded gold bullion fund. Those who believe prices will rise (bulls) buy calls. Those negative on prices (bears) buy puts.