The transaction cost of convertible bonds is very low, much lower than buying and selling stocks. The cost of buying and selling every stock is stamp duty, transfer fee, trading commission and other fees. Convertible bonds have no stamp duty and almost no other fees. To some extent, there is only the so-called trading commission (commission is also included) and it is very low. To some extent, the commission can be as low as less than 1/10,000 per transaction. At least 1% stamp duty and 2% transaction commission. Such low transaction costs are one of the major reasons why investors are flocking to the market. Another example is the Invesco convertible bonds that Top Secret Insider was involved in mining. The pre-market logic of the day was that Invesco Healthcare was the fire of the epidemic sector and was predicted to pull away, but I was worried that not the leaders couldn't stop it.
The upward and downward trends in convertible bonds follow the upward and downward trends in the underlying stock, the underlying stock, the convertible bond, the underlying stock and the convertible bond. If you are optimistic about the rise of a particular stock and are concerned about the risk of a possible fall the next day, you can choose to buy the convertible bond at a low level and then sell it at a high level and complete the T 0 in one day. of course, if the market sentiment is good, the operation will have a higher success rate.
This is similar to the first category, the difference is that the original stock is strong, is the leader, accelerated stop blocking. You can't buy the genuine stock, because the stock stop system is limited, but convertible bonds do not have this limitation. Reaction fast investors see the positive stock stop, will immediately buy convertible bonds. The more people buy, the more convertible bonds, the more arbitrage space. Thai crystal technology can not buy a word board, so smart to buy Thai crystal convertible bonds, directly Thai crystal convertible bonds opening price rose 16%, the day's maximum increase of 30%. So, if your hand is fast enough, Thai Jing Technology can arbitrage 14% in one day, more than a stop. Convertible bonds time-shift up and down quickly for traders who are sensitive to the theme and have time to keep an eye on the market.
Once we managed to eat the spread, we ran the convertible bond on the same day. If we hadn't set a stop loss, say a mechanical stop loss of 3% on the hedged position, we wouldn't have lost much. The results were much better than expected. Invesco Healthcare has become a leader for three consecutive board days. The convertible bonds have also risen more than ten points in three consecutive days. Of course, the idea of an overnight operation essentially disappeared in one day. Eating a board is great, too. This kind of game is practically speculation and demands a lot from investors. The income is big, the risk is high, and it's easy to get addicted after playing, especially if those who've tasted the sweetness think it's a shortcut to short-term riches.