Covered warrants: another way to cap your risks

Many traders like the potential for higher returns that leveraged investments such as spread betting or contracts for difference (CFDs) can provide, but are worried about the possibility of running up large losses.

This risk can be controlled with stop-losses, but some investors prefer not to have the complication of managing these, especially while getting to grips with leveraged trading for the first time.

Stop-losses may also see you knocked out of a position when the share price hits your stop, only to see the share reverse course, and the bet turn profitable – [...]

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