Leverage – The Julius Baer warrants
Leverage products – how they work
Warrants certify the right to buy (call warrant) or sell (put warrant) an underlying security at a predetermined price on a certain date. Warrants allow you to play upon short-term price fluctuations in an underlying security with a modest investment. Because of the leveraging effect, the chances for profits as well as losses are substantially higher compared to a similarly sized investment in the underlying security.
Leverage products are the right investment solution if you
are prepared to take on a higher level of risk
want to participate disproportionately in or hedge yourself against price fluctuations in an underlying security
expect the underlying security to perform positively (call) or negatively (put)
Call-Warrant
If the price of the underlying security upon expiration is above the break-even (the strike price plus the purchase price), you realize a profit, otherwise a loss.
Put-Warrant
If the price of the underlying security upon expiration is below the break-even (the strike price minus the purchase price), you realize a profit, otherwise a loss.
