Officially traded on the Hong Kong Stock Exchange in 2006, callable bull/bear contracts are issued by third-party institutions such as investment banks and other issuers, and investors only need to pay a small investment amount to fully invest in derivative investment products with the performance of the underlying asset (index or securities). CBBCs have an expiry date (ranging from 3 months to 5 years) and a call price, during which if the price of the underlying asset touches the call price, the CBBC will be terminated and voided immediately.

The CBBC price trend will be close to the price of the underlying asset, and whether the price of the underlying asset rises or falls, the CBBC price should be close to the equivalent increase or fall. However, when the price of the underlying asset approaches the call price, the CBBC price will become volatile or even detached from the discount price with the underlying asset price.

It is a bull and bear product that is optimistic about the future market, and the investor is optimistic about the future trend of a certain underlying stock, and he can buy the bull contract linked to the relevant underlying stock.

It is a bullish CBBC product that bears the future market, and investors are bearish on something.

There are two types of option contracts: put options and call options, and since you can buy or sell option contracts, there are basically four trading strategies.

The basic strategies for trading options can be simply divided into two groups: 1) bullish on the future and 2) bearish on the future

Buy - Call Option (Long Call)

The stock is expected to rise to the target price range within a specific period of time, lose the premium at most, and earn an unlimited profit.

Put - Short Put  

It is expected that the stock will not fall below the strike price within a specific period of time, exhaust the premium, and lose all the stock to 0 yuan.

Buy - Long Put

It is expected that the stock will fall to the target price range within a specific period of time, losing the premium at most, and earning all the money if the stock falls to $0.

Sell - Short Call

It is expected that the stock will not rise above the strike price within a specific period of time, exhaust the premium, and lose indefinitely. If investors set the stop-loss price in advance and can strictly adhere to the stop-loss, they can reduce their losses without worrying about the so-called "unlimited loss".