Australian equity warrants: Are retail investors getting a fair go?

Hunt, B; Terry, C

Australian equity warrants: Are retail investors getting a fair go?

Hunt, B Terry, C

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Publication Type:: Journal Article
Citation:: JASSA, 2011, 2 (4), pp. 48 - 54
Issue Date:: 2011-12-01

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Field	Value	Language
dc.contributor.author	Hunt, B	en_US
dc.contributor.author	Terry, C https://orcid.org/0000-0002-2759-8933	en_US
dc.date.issued	2011-12-01	en_US
dc.identifier.citation	JASSA, 2011, 2 (4), pp. 48 - 54	en_US
dc.identifier.issn	0313-5934	en_US
dc.identifier.uri	http://hdl.handle.net/10453/18872
dc.description.abstract	The AS X has two functionally similar markets for contingent equity contracts - a warrants market principally serving retail investors and an ETO market that may be used by retail and professional traders. Using pricing and volatility comparisons, this study finds that warrants are generally overpriced and are significantly dearer than their ETO equivalents. The paper recommends that short selling be allowed in the warrants market in order to reduce the pricing differentials and end the systematic exploitation of retail warrant investors by warrant issuers.	en_US
dc.relation.ispartof	JASSA	en_US
dc.title	Australian equity warrants: Are retail investors getting a fair go?	en_US
dc.type	Journal Article
utslib.citation.volume	4	en_US
utslib.citation.volume	2	en_US
utslib.for	1502 Banking, Finance and Investment	en_US
utslib.for	1501 Accounting, Auditing and Accountability	en_US
utslib.for	1801 Law	en_US
pubs.embargo.period	Not known	en_US
pubs.organisational-group	/University of Technology Sydney
pubs.organisational-group	/University of Technology Sydney/Faculty of Business
pubs.organisational-group	/University of Technology Sydney/Faculty of Business/Finance Discipline
utslib.copyright.status	open_access
pubs.issue	4	en_US
pubs.publication-status	Published	en_US
pubs.volume	2	en_US

Abstract:

The AS X has two functionally similar markets for contingent equity contracts - a warrants market principally serving retail investors and an ETO market that may be used by retail and professional traders. Using pricing and volatility comparisons, this study finds that warrants are generally overpriced and are significantly dearer than their ETO equivalents. The paper recommends that short selling be allowed in the warrants market in order to reduce the pricing differentials and end the systematic exploitation of retail warrant investors by warrant issuers.

Please use this identifier to cite or link to this item:

http://hdl.handle.net/10453/18872