Above is the information I get from my online broker. As we can see that the premium for Axiata-ha is -2.71% (which is a discount of 2.71%). Besides, the exercise price is RM3.40, expiry date is 25/8/2010 and gearing is 10.35.
With a discount and the market is decreasing, axiata-ha looks like a good potential trade. The joy is varnished as soon as I try to double check the information especially the premium of axiata-ha.
The correct formula to calculate put warrants premium is as below.
The calculated axiata-ha premium is = [(0.075 x 5)+ 3.88 - 3.40 ] / 3.88 = 22%
The calculated axiata-ha preimum of 22% is very different from the premium I get from my online broker of -2.71%. It is really misleading.
I try to check the put warrant premium and information at Bursa Malaysia and CIMB Warrant website too. To my disappointment, Bursa Malaysia doesn't get the premium correct too. However, CIMB Warrant does a good job by calculating the premium correctly.
That's why we must always double check the information we get.
Ok, good luck.
GOon
Hi, i am interested of put warrant. But do you think malaysia warrant is effective? Thanks.
ReplyDeleteRegards,
Kent
i dont think it is efficient. at the same time it is lack of liquidity and choices. there are only a few put warrants listed on KLSE. besides, the premium is very high.
ReplyDelete(0.75x5+3.4-3.88)*100/3.88 = -2.7%
ReplyDeletehow's it sounds?
Check ur calculation again pls! dont just spam some shit
Delete-2.7% is correct lah..
DeleteThe warrant market is definitely picking up.
ReplyDeleteI personally feel the best market maker for warrants is still CIMB. Their spread has always been very tight with a proper bid-ask price. They often track the underlying closely.
There are few instances with AmBank and OSK where the underlying goes up but the warrant price goes down. hahaha.. so be careful la
How to calculate FBMKLCI-H5 with 1520 700:1?
ReplyDelete