In a period of time after ex-dividend and ex-dividend, if most people are optimistic about the stock, the market price of the stock is higher than the ex-dividend benchmark price, which is called right filling. Specifically, when investors holding options or futures contracts think that the market price has exceeded the exercise price of options or futures contracts (that is, imaginary value).
Or when the expiration date (that is, the real value) of the option or futures contract has arrived, you will choose to close the position and get the corresponding income.
Filling the right is a risky investment strategy, which requires investors to have a more accurate judgment and grasp of market trends and fluctuations. At the same time, the right-filling also requires investors to have certain financial strength and risk tolerance, because the right-filling operation may bring greater profit and loss fluctuations.
The role of the right to fill:
1. Providing investment opportunities: Rights filling provides investors with a way to trade through options or futures contracts, thus expanding their investment scope and opportunities. Investors can obtain corresponding benefits and bear corresponding risks through the operation of filling in rights.
2. Stabilize market fluctuation: Correct filling operation can stabilize market price, thus reducing market fluctuation. For example, when investors think that the market will fluctuate greatly, they can choose to close their options or futures contracts, thus reducing the degree of market fluctuation.
3. Support risk management: The correct filling operation can help investors manage risks. For example, when investors think that the price of an asset may fall, they can choose to fill in their put options to lock in their possible losses.
4. Promote market liquidity: Correct filling operation can promote market liquidity. Through the right filling operation, investors can sell their options or futures contracts to other investors, thus increasing the trading volume and activity of the market.