THE MARKET OF COVERED WARRANTS

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The market of the covered warrants is a still young market, been born in 1998, but that fast evolution has already had one. In spite of the profuse efforts from Italian Ag and same the Makers Market, such market still introduces of the important inefficiencies. The delays nell?aggiornamento of the prices represent one of more feel problems from part of the investor. The Regulations of Ag preview the maximum period of 5 minuteren in which the MILIMETER it can be absented from the book, but often the delays are greater. Two are the reasons: technological and normative aspect. The first one has been removed with the creation of one technological platform dedicated to the exchange of the cw. In such platform they can be exchanges you until 10.000 cw, therefore that the overload problems have been eliminates to you. The problem of the limitations all?accesso $R-al.mercato from part of the MILIMETER remains however based on the n° of cw is emitted, is to the n° of concluded contracts: the overcoming of such limits involves, in fact, for the MILIMETER pecuniarie pains. And? for that the MILIMETER carries out numerous emissions of covered, than often they do not deal, but that they allow to modernize it in efficient way those cw in which is concentrated l?interesse of the investor.

  A innovation that has had positive effects you, but that it has not resolved totally the problem, has been l?introduzione of the technology double quotation that it allows with a single $R-al.mercato access to modernize prices at the same time and amount is in purchase that in sale. Today the Mcw (Market of the Covered Warrant) is introduced with an excessive number of products (approximately 7.000) and issuing (20), that they have contributed, with to the ag decreases succedutisi from March 2000, progressive all?allontanamento of the investor retail. The exchanges, in fact, are stabilize to you on low levels: on 7.000 instruments nearly 5,800 they do not exchange (l?80% that is) and l?attenzione of the investor is concentrated on little instruments.

  The professional investor, that they represent 80% of the market of the covered warrant, try to take advantage of, through operations d?arbitraggio, inefficiencies of the market. Operations rendered possible from the delays in the modernizations of the prices and from the possibility to carry out operations of short thanks to some brokers on-linens. To test of this l?80% of the volumes it is concentrated on the indices, than on the short term, risentono less than extraordinary events. Such situation is bringing a damage not only to the MILIMETER that is defended from the?attacchi? of the arbitraggisti with means to disposition (cuts of volatilità and increase scissor bid-ask), but also to the small investor, than do not look at in a market much manipulable one protected. In this phase of bear it is not sure state of aid also l?insuccesso of the cw put, than they are not takes off to you with the decreases of the markets, above all for l?inferiore qualitative level regarding the call is from the point of view of the liquidity that give that one of the delays in the modernizations. If the markets will not give signs of resumption within end dell?anno 2002, it is previewed l?uscita from the market of approximately 7-8 market makers, that due also to the lack of a concrete diversification of the products in a market that necessity of new ideas in order to approach again the investor.

Edited by      Riccardo   Catalani

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The present report must be meant like information source and he cannot, in no case, considered being an offer or one sollicitation to the purchase or the sale of issues. The contained information in this study are fruit of news and opinions that can anytime be modified without warning.