With the Covid-19 pandemic dominating market sentiment, both the global and Hong Kong stock markets are expected to stay relatively volatile in the near future. There are investment opportunities that are presented in such market conditions. The interest rates of Equity-linked Investments tend to rise in tandem with higher market volatilities, and hence bringing higher yields to investors. Also, ELI offer investors the option to buy stocks at a discount to their spot prices through a fixing mechanism. In a scenario where the market prices of a stock drop below the predetermined exercise price on a specified date, the investor can still acquire the stocks at the predetermined price; and once the stock prices rise above the exercise price, the investors could profit from selling the stocks. The operations could potentially bring in both interest income and capital gains. Bear in mind that investor may receive physical delivery of underlying asset. Therefore, you should always maintain sufficient funds to ensure you have the holding power of the stocks in the long term. To learn more about Equity-linked Investments, take classes together with Mr. Confused!
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Investment involves risk. You should carefully consider whether any investment products or services mentioned herein are appropriate for you in view of your investment experience, objectives, financial resources and circumstances.