As required by the legislation, warrant issuers designate a market maker in order to provide depth in the warrants they issue. The market maker provides continuously updated buy and sell quotations during Borsa Istanbul trading hours, and investors execute their buy and sell transactions based on these quotations. However, market makers may not be a party to every transaction, and trades may also be matched directly between investors.
Ak Investment endeavors to keep the difference (spread) between market maker bid and ask prices as narrow as possible in line with market conditions. However, in certain exceptional circumstances, the market maker may not be able to transmit its quotations to Borsa Istanbul. Some of these special circumstances include:
Unusual volatility in the underlying assets, or reaching the limit of the warrant issuance authorization obtained from the Capital Markets Board for the relevant warrant,
The warrant losing all of its value before maturity,
Failure of price formation in the underlying asset (such as when circuit breaker, ceiling, or floor rules are in effect) or the occurrence of a technical system issue.
In such cases, since the best bid and ask prices on the warrant trading screens are formed as a result of investor supply and demand, warrant prices may not move in parallel with the price movements of the relevant underlying asset and may artificially increase or decrease.
Ak Investment aims to provide investors with the narrowest spreads and the highest possible liquidity through market maker quotations. However, due to unusual volatility or liquidity issues in the underlying assets, the bid-ask spread may widen. When the spread widens, the market maker bid price generally remains unchanged while the market maker ask price increases. This approach helps prevent warrant investors from being negatively affected by widening spreads.
It is very important for investors to review the market maker’s bid and ask quotations before trading in order to avoid executing transactions at prices far from the warrant’s theoretical value. Market maker quotations can be easily monitored through the detailed screens of data providers such as Foreks and Matriks, as well as on the Ak Investment Warrants Website, enabling investors to make informed investment decisions.
To avoid trading warrants at prices significantly different from their theoretical values, investors should always check market maker bid and ask quotations prior to trading. These quotations can be easily followed via the detailed screens of data providers such as ForInvest, Matriks, and Ideal, as well as on the Ak Investment Warrants website, and investment decisions can be made accordingly.
