OREANDA-NEWS. In the month thus far, the Nikkei 225 warrants have maintained a comparatively higher Put-Call ratio than the overall Put-Call ratio for all of the structured warrants traded on SGX. The Nikkei Put-Call Ratio compared to the overall 0.41 Put-Call Ratio for the month to date turnover.

In the Options or Warrants markets, a Put-to-Call ratio can be used as an indicator to gauge the overall market sentiment. The ratio is achieved by dividing the trade value of Put options by Call options. As this number increases, it can be interpreted that more money is going into Put rather than Call options. With activity in the Put options outweighing its Call counterpart, it signals that investors may be speculating a downward movement in the market or hedging their portfolios.

Japan is the only country in Asia that maintains a negative interest rate policy. According to a recent Reuters poll yesterday (19 July), the majority of economists are expecting the Bank of Japan to ease policy later this month when they end their two-day meeting on 29 July.

The last four counts of Japan’s GDP have oscillated between -0.4% and 0.5% with the long term average growth rate at +0.5%. Thus, Japan has continued to maintain a highly competitive currency – and its 2015 net trade balance was almost the mid-point value of China’s net exports and the United States’ net imports.

The five largest constituent weights of the Nikkei 225 Index are currently made up of a retailer, two telcos and two manufacturers. Unlike the S&P 500, or Singapore’s Straits Times Index (STI), Financials do not represent the largest sector of the Index. Four-fifths of the Nikkei 225 stocks represent four sectors - Consumer, Industrial, Information Technology and Healthcare.

The 40 most actively traded structured warrants in the July month to date are tabled below. In the month to date there has been S$471 million of turnover in structured warrants listed for trading on SGX. As noted above, this turnover generated a Put-Call Ratio of 0.41. As much as S$438 million of the turnover was in HSI warrants with a Put-Call ratio of 0.42. The 40 most active structured warrants in the month to date are tabled below.

Structured Warrants have a growing presence in Asia as an alternative for investors to participate in the performance of an underlying asset at a fraction of its price, in both bullish and bearish markets. Click here for educational videos covering the basics of trading structured warrants.