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Sharkie, before issue there is no market price. Just a reference price. Premium is derived from the last done price. As such, premium (high or low) is determine by the market, not the issuer. So the market (you and i) determine the premium.
If C48 were to expire today, its value would be RM0.50 based on its exercise price, exercise ratio and the underlying price. So if it is negative and you buy today, you will immediately make money when IB make cash settlement.
Chee Siong, I was referring to IF C48 were to expire today. Then IB (Investment Bank) would have to make cash settlement for those holding the Called Warrant since C48 is in-the-money.
Assuming Harta closes at RM18 today, each C48 would be worth RM0.465.
RM18 - RM12.45 = RM5.55
RM5.55 / 12 = RM0.465
So IB will have to pay you RM0.464 as cash settlement
Sharkie, agree not all will be negative premium BUT the key is knowing which one will be negative and which one shouldn't be negative and make money from it.
Loke shu teng great explanation
But one last question if you dont mind,
If i still hold the warrant c48 till today, the bank will pay me cash settlement if the mother share up to RM18 right?
Loke shu teng it will expired automatically or i need to call the banker? Or the banker will direct pay the cash settlement if i still hold the ticket?
Chee Siong, since the exercise price is RM12.45, if the price of the underlying (in this case Harta) is above RM12.45, then it is in-the-money and IB will have to make cash settlement.
Let assume we buy 12 shares of C48 at RM0.30. So our cost is RM3.60
And assume on the expiry date, the price of underlying is RM13.
So IB will pay (RM13-RM12.45)/12 = RM0.0465. Note it is divide by 12 due to the ratio
Hence our cost is RM0.30 per share BUT IB only pay us RM0.0465 per share. We make lose.
Kelvin, i can't tell the future price of any stock or warrant.
C54 is out-of-money and has a premium of 25%. Why you want to pay high premium? I'm not saying it is wrong to pay a high premium but you HAVE to know why. if not, it is like paying RM200k for a car. Not saying RM200k for a car is expensive BUT do you know why you want to pay RM200k for it?
Again, please dont buy if you dont know what you are buying. it is like you pay RM200k for a car but no idea what kind of car.
kelvin, I'm not a fortune teller. I wouldn't know. And even if I (or anyone else) give you some price guidance, why would you want to believe me (or anyone else). Unless I can provide justification, if not whatever I predict is just a wild guess - which you also can do.
Also, it is best you make your own decision on your investment. At the end of the day, it is your money.
Anyway, warrant price is related to its underlying.
premium 25% for me is not so high seen it is new warrant
my portfolio
harta c60 200% gain buy in 0.04
topglove c94 buy in 0.08 premium 35% also 100% gain ++
we buy warrant not because in the money is because it has paper gain and have people to goreng since i wont hold it until expiry
ya I agree with you haha but I know what I am doing at least I am save now those warrant previously cost premium 100% more now drop until below 30% think yourself haha
Ray Ng, the main question to ask is why C53 move up only 0.005?
If the answer is because it is laggard, then we should buy more. Eventually the price will go up. However, if C53 is overvalued (despite up only 0.005), then we should stay away from it.
凭运气赚的钱终有一天会凭实力输回去，this is the advise for those who want trade warrant，if u had earned thick profit then congrats to you all，and wish the luck always be with u
Both C47 and C48 are in-the-money and have almost the same expiry date. However, C47 have a higher premium (means more expensive) but a higher gearing (means more leverage) than C48.
So depends on your appetite. Personally, I prefer C48 over C47.
seen healthcare index really hit resistance and retrace so I will see back only it breakout resistance yesterday already switch my fund to furniture stock
C60 - slightly high premium (about 20%) but justify by expiry date of end Mar 2021. Good gearing too. I might consider once I realized my profit from C48 and C52
c54 equal mother 23.4, lol, don't buy premium 10++ one, unless u really can predict mother 24++, so u profit, and of course some of them bought c54 under 0.10 so they still profit abit
warrants are not as straight forward & to always expect it to follow mother movement up or down is a wrong perception. there are other factors to understand first before playing cw
Warrant is an option. Simple as that. You can also think of a warrant as a coupon/voucher that can exchange (exercise) for an underlying. The underlying for warrant is the mother share while the underlying for coupon/voucher could be a McD Big Mac. So the question is how much are you willing to pay for a warrant (or coupon/voucher)?