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Published to coincide with the launch of the new ‘covered warrants’
market in London in 2002 this book is a must for warrants investors, old
and new.
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Warning: you should
not buy shares or warrants with money you cannot afford to lose. This
web site is intended for UK investors. Options and other derivatives,
warrants, and margined transactions. This warning notice draws your attention
to some of the high risks associated with warrants. The risks attaching
to instruments and transactions of this kind are usually different from,
and can be much greater than, those attached to securities such as shares,
loan stock and bonds, such transactions often having the characteristics
of speculation as opposed to investment. Warrants may involve a high degree
of 'gearing' or 'leverage'. This means that a small movement in the price
of the underlying asset may have a disproportionately dramatic effect
on your investment. A relatively small adverse movement in the price of
the underlying asset can result in the loss of the whole of your original
investment. Moreover, because of the limited life of warrants, they may
expire worthless. A warrant is a right to subscribe for shares, debentures,
loan stock or government securities, usually exercisable against the original
issuer of the securities. Because of the high degree of gearing which
they may involve, the prices of warrants can be volatile. Accordingly,
you should not buy warrants with money you cannot afford to lose. You
run an extra risk of losing money when you buy shares in certain smaller
companies including ‘penny shares’. There is a big difference
between the buying price and the selling price of these shares. If you
have to sell them immediately, you may get back much less than you paid
for them. The price may change quickly, it may go down as well as up,
and you may not get back the full amount invested. It may be difficult
to sell or realise the investment. Because of the volatile nature of the
investment, a fall in its value could result in your recovering nothing
at all. Changes in rates of exchange may have an adverse effect on the
value or price of the investment in sterling terms. As with other investments,
transactions in warrants, shares, and investment trusts may also have
tax consequences and on these you should consult your tax adviser. We
have taken all reasonable care to ensure that all statements of fact and
opinion contained on this site are fair and accurate in all material respects.
Investors should seek appropriate professional advice if any points are
unclear. This site is intended to give general advice only, and the investments
mentioned are not necessarily suitable for any individual. It is possible
that the McHattie Warrants Alert Fund or officers of the McHattie Group
may have a beneficial holding in any of the securities mentioned. Published
by The McHattie Group, St Brandon's House, 29 Great George Street, Bristol,
BS1 5QT. Tel: 01179 200 070. Fax: 01179 200 071. E-mail: enquiries at
mchattie.co.uk. All rights reserved. No part of this site may be reproduced,
stored in a retrieval system, or transmitted in any form by any means,
electronic, mechanical, photographic, or otherwise without the prior permission
of the copyright holder. Authorised and regulated by the Financial Services
Authority. |
Securitised Derivatives:
these instruments may give you a time-limited right to acquire or sell
one or more types of instrument which is normally exercisable against
someone other than the issuer of that investment. Or they may give you
rights under a contract for differences which allow for speculation on
fluctuations in the value of the property of any description or an index,
such as the FTSE 100 Index. In both cases, the investment or property
may be referred to as the “underlying instrument.” These instruments often involve a high degree of gearing or leverage, so that a relatively small movement in the price of the underlying investment results in a much larger movement, favourable or unfavourable, in the price of the instrument. The price of these instruments can therefore be volatile. These instruments have a limited life, and may (unless there is some form of guaranteed return to the amount you are investing in the product) expire worthless if the underlying instrument does not perform as expected. You should only buy this product if you are prepared to sustain a total loss of the money you have invested plus any commission or other transaction charges. You should consider carefully whether or not this product is suitable for you in light of your circumstances and financial position, and if in any doubt please seek professional advice. |
