In-depth Analysis of Pop Mart Warrants Market

Analysis of Deviation Between Technical Coordinates and Market Expectations

The warrant market is showing a clear divergence between the technical framework and market expectations. At the current underlying stock price of HK$254.8, the reasonable range for technical activity should be between the support level of HK$245.4 and the resistance level of HK$264.2. However, market funds are heavily concentrated in deep out-of-the-money ranges with strike prices far exceeding technical targets. In particular, UBS Group-issued products with a strike price of HK$410.12 have a street ratio as high as 94.2%, indicating that market participants are betting on a breakout scenario far beyond the technical resistance. This structural deviation reflects a significant gap between market expectations and technical realities.

Structural Characteristics of Exercise Price Range

Market warrants show a clear structural stratification by exercise price: The out-of-the-money main range (HK$270.12-338.89) concentrates 70 products, forming the core area for daily wave trading; the deep out-of-the-money range (HK$339.90-588.88) has 47 products but with a street volume of 421.36 million shares, showing over-concentration risk. The near-at-the-money range (HK$249.92-270.00), as a key breakout game zone, includes 28 products carrying market expectations of technical breakouts. This layered structure clearly reflects allocation strategies for funds with different risk appetites.

Liquidity Divergence and Risk Structure

The trading distribution shows a clear liquidity divergence phenomenon. The out-of-the-money main range became the most active region with a trading volume of 233,166 thousand yuan, reflecting the characteristics of swing trading by operational funds; the near-at-the-money range, with a trading volume of 35,832 thousand yuan, indicates active participation from breakout speculative funds; while the deep out-of-the-money range, despite having the largest open interest, recorded only 10,679 thousand yuan in trading volume, resulting in a turnover ratio of 1,732.64 — much lower than other ranges — forming a typical 'high holdings, low liquidity' risk structure.

Clause efficiency and technical space alignment

Analyzing from the perspective of clause competitiveness, the out-of-the-money core range offers actual leverage of 5.37x paired with implied volatility of 62.28%, striking the best balance between technical space and cost efficiency; the near-at-the-money range provides 4.14x leverage with a hedge value of 56.43%, offering a reasonable risk-reward ratio for breakout speculation; while the deep out-of-the-money range has higher leverage at 7.29x, its implied volatility is significantly high at 70.34%, and its exercise price is far from the technical target, showing evident inefficiency in clause alignment with technical space.

Concentration of structural risks and market impact

The current market's greatest structural risk is concentrated in the deep out-of-the-money range, particularly around products with an exercise price near 410 HKD that are overly concentrated. If the underlying stock fails to achieve the expected technical breakout, products in this range will face dual pressures of implied volatility contraction and accelerated time decay. Meanwhile, although the out-of-the-money core range enjoys sufficient liquidity, one must also be wary of volatility decline risks caused by sustained stock price oscillation within a range, which could affect the clause efficiency of products in this range.

Market status and capital behavior characteristics

The overall market shows significant divergence between operational capital and scenario-betting capital. Operational capital is focused on the out-of-the-money core range for swing trading within technical boundaries, while scenario-betting capital accumulates heavily in the deep out-of-the-money range awaiting unexpected breakouts. This divergence in capital behavior reflects differing views on future market prospects while highlighting the currently high structural risk in the warrant market. Future market performance will largely depend on whether the underlying stock can successfully break through technical resistance levels, realigning market expectations with the technical framework.

Featured Products

J.P. Morgan 20615 $JPPOMRT@EC2610B.C (20615.HK)$

Strike Price: 306.08 yuan

Actual Leverage: 3.4x

Expiration Date: October 23, 2026

Recommendation Reason: The strike price is set above the technical resistance level of 264.2 yuan, with breakout potential. 3.4x leverage provides a reasonable balance between risk and reward. Implied volatility of 61.99% is at a reasonable level for out-of-the-money products.

Merrill Lynch 22279 $MSPOMRT@EC2604A.C (22279.HK)$

Strike Price: 288.20 yuan

Effective Leverage: 6.2x

Expiration Date: April 20, 2026

Recommendation Reason: 6.2x leverage is relatively high within similar products, with significant amplification effects. The strike price of 288.20 yuan is close to major resistance levels, offering a higher likelihood of a breakout. The expiration date is moderate, balancing time value with leverage effects.

BOC 24839 $BIPOMRT@EC2606A.C (24839.HK)$

Strike Price: 254.08 yuan (slightly in-the-money)

Actual Leverage: 4.0x

Maturity Date: June 30, 2026

Recommendation Reason:

The strike price is extremely close to the current price, with a delta value near 0.5, and implied volatility of 59.73% is the lowest among similar products, offering a clear cost advantage.

There is significant structural risk in the current warrant market, with deep out-of-the-money products excessively concentrated in street inventory. If the underlying stock fails to break through the resistance level at 264.2 yuan, these products will face dual pressures: accelerated value erosion due to implied volatility contraction, and rapid time decay.

This article is for reference only and does not constitute any investment advice. The market data, opinions, and analysis contained herein may change at any time without prior notice. We assume no responsibility for any loss or damage resulting from reliance on the information in this article. Technical analysis only indicates whether certain technical conditions are met; a comprehensive assessment of asset performance should combine other data, and trading decisions should not be made solely based on this article. Please note that past performance is not indicative of future results. Be sure to follow 'Hong Kong Warrants Jenny' for more professional analysis articles on investment opportunities in Hong Kong stock derivatives!

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