Look I get it, of course he’s going to promote his company, and the way he’s put it it’s not really an issue about “self-promoting”, as he’s educating and not just spamming for clicks or advertising.
The issue I see is it’s a random post about them, not in response to an actual question. This would be perfectly fine imo as a reply to someone asking about them, but as a stand-alone post… it seems more orientated towards self promotion. But I don’t really care, just ignore it if you don’t care.
On a different note, is there anyway of getting a Nikola short? I’m not comfortable opening CFD but I’d love to have this available for this fraud (imo )
I have added a disclaimer to the post at the bottom in bold, in addition to the one I already mention in my profile.
I decided to make a separate topic due to previous questions (about inverse ETPs) in multiple posts - just to aggregate them. I feel it adds value since, although I mentioned the Leverage Shares products here, the concept is the same for products (like market index trackers) by other providers like Xtrackers, WisdomTree, etc.
Once again, if considered spam - I’d be happy to remove.
There is a market maker taking both sides (buy & sell) throughout the day - BNP Paribas in this case. Even for institutional sizes ($ millions), liquidity should not be an issue.
This is how ETPs (and ETFs) work in general, since they are open-ended products. There are what’s called dedicated market makers (DMM) that are obliged to provide tight quotes throughout the trading day.
Even if the ETP (or ETF) itself has low volume or assets under management, these market makers will take both sides of the trade since they can always offset by creating or redeeming in the ‘primary market.’ This is why it’s very important for the ETPs to have very liquid underlying stocks.
And if you don’t mind explaining, @Oktay, how are these quotes derived for UK instruments when the subject of the ETP’s (eg. Tesla or Apple) market is closed?
I’m aware this is more general ETF/P-related question but it’s an area I have very little understanding of. Guessing it’s derivative-related, but again, my knowledge of derivatives is zero, so appreciate any insight into this. Thanks
PS. I have Googled this but can’t find a satisfactory answer.
Since a market maker HAS to make markets (they buy when someone wants to sell, and sell when someone wants to buy) - they will either end up with an inventory of ETF/ETPs or be short ETF/ETPs.
Here’s the caveat - MMs don’t want risk. So when they are long or short any product, they have to hedge. In the case of typical index ETFs (like S&P 500 or Nasdaq-100 that trade in Europe), they’d most likely hedge with futures given they trade around the clock. In the case of these ETPs, they hedge with the GDRs (global depository receipts) that trade in Germany (see ticker TL0 for Tesla and APC for Apple). For example, if the market maker (MM) is long the Tesla ETP it bought from you, it will offset this by being short the Tesla GDR - bringing it to a neutral position.
This then begs the question - how are GDRs priced? Just like many depository receipts in the US (like Alibaba), they use price movements in the home market, news that come out after market closes, and demand/trading where the depository receipt itself trades. This is what’s called a price discovery mechanism, b/c trading elsewhere gives a relatively good idea about how the stock will resume trading in its ‘home market.’
I think the post below could provide some clarifications (you need to scroll down a bit to my response to libreus).
He must be a friend of @Team212 otherwise he would have been banned a long time ago by mods. Just had a look to his profile and posts. The guys is essentially here to sell his lousy leveraged products.
@kali I think the difference is just in whether they are commenting it’s advertisement, or if they are actually reporting it as such. George was probably looking at it from the view point that Oktay isn’t outright asking for money in return for a product or service, rather just talks about the leverage shares, how they work etc which is at least still useful from an educational standpoint.
however if enough people consider it advertisement and report it as such, then its likely Oktay will need to change how they write the articles.
Is business development also known as sales? I work a lot in business development and half my colleagues are business developers and none of us do sales at all and never have. I couldn’t sell my way out of a paper bag.
Maybe my post did not come off as transparent and objective as I intended - apologies for that.
I personally have invested via multiple brokers and one of T212’s greatest assets is its community, so I don’t want to dilute that by any means (I’ve been a user of the platform for much longer than I’ve been active here).
I hate spam/marketing probably more than anyone here, so this will be my last topic on the matter.
You should keep replying to posts that have questions regarding ETPs.
Education is very important.
It’s better they understand what they are getting into instead of playing with something they don’t understand.
Personally, I was not disturbed by your posts.
But also being a hyper bull I’m only a buyer of stocks for the long term, 5-10 years horizon, I only sell if I don’t believe in the company anymore.
So get rich quick schemes are not for me, slow and steady(and consistent) wins the race.