Q: Recently, some internet platforms have promoted that they can provide over-the-counter individual stock option trading services. Can ordinary investors participate?
A: Recently, some Internet platforms have solicited customers through websites, WeChat official account, groups and other means to provide investors with over-the-counter individual stock option trading services. Investors do not need to open securities accounts, nor do they need to conduct video authentication. They can complete registration only by providing ID number and bank account. After determining the operating target, call and put direction, holding period, and accepting the option quotation (i.e. premium), investors can purchase and become the right holder of the option. Taking call options as an example, if the individual stock price on the exercise date is higher than the agreed price and the increase amount is greater than the premium, then the investor is profitable; If the amount of increase is less than the premium or if a stock falls, the investor will lose some or all of the premium.
These platforms do not have corresponding financial business qualifications, their internal control and compliance mechanisms are not sound, their royalty requirements are too high, and they lack a third-party deposit mechanism for funds, posing obvious risks and hidden dangers. In addition, these platforms often use misleading promotional terms such as "high leverage", "limited losses but unlimited profits", and "losses do not require covering positions", emphasizing or even exaggerating the returns of individual stock options, weakening or even not indicating the risks of individual stock options. Investors participating in over-the-counter individual stock option trading through these platforms pose significant risks. If there are fraudulent activities or risk events such as "running away" on the platform, it is difficult to protect their own rights and interests. Investors are advised to be highly vigilant, not trusting or participating, in order to avoid being deceived and suffering losses.
