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Hot Sector – Trading the excellent volatility in Oil and Gas stocks

Trading room – Fri 14 Dec 2018

Have oil prices hit a bottom or will there be further downside? Brent crude price was trading as high as USD86.29 per barrel in early October but has slumped very quickly to as low as close to USD60.00 per barrel recently.  The reversal shocked many analysts who were predicting then that oil price could be on the cusp ofrecovery.

Some even predicted that it could breach US$100 per barrel as early as next year at that time. However, the price slumped over 32% in a shortspan of two months.

Those who have been following the mPower Algorithm reports know that the critical level for the oil prices were broken then at the two stated levels mentioned and we exited the sector immediately two months back.

Continue reading Hot Sector – Trading the excellent volatility in Oil and Gas stocks
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Hot Stocks – E-Govt players fall like dominoes

Trading room – Thu 13 Dec 2018

The shares of some e-govt players have been falling like dominoes after the cancellation of a contract to Prestariang Berhad and fears that there are future cancellations as well to other players such as My Eg Berhad.

Shares in Prestariang Bhd had slided in the wake of the cancellation of itsRM3.5bil national immigration control system (SKIN) concession. The shares recently plunged 15 sen to 30.5 sen, its lowest level in nearly seven years as panic selling ensued after news broke on the project cancellation.

According to media reports, the Home Ministry confirmed the Immigration Department’sRM3.5bil national immigration control system (SKIN) concession has been canceled.

Continue reading Hot Stocks – E-Govt players fall like dominoes
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Trading – How to trade and win in the market (without being overworked and burnt-out)?

Trading room – Tue 11 Dec 2018

Every trader wants to buy a stock that is going to go higher and obviously, for those who sell or short, the same trader wants to enter into a trade that is going to go lower.

Now, we all know that stock price movement is at its base merely a function of the supply and demand for the stock.

For a stock that is going to move higher, it’s just simple more buyers who want to own a particular stock versus the number of sellers who are willing to sell their shares to those buyers. But here is the key consideration.

Elite traders want a stock that is always going to move in a significant way. Of course, they’ll always be small, thinly traded stocks that will pop up for a day or two but there won’t be any liquidity in these stocks for a trader to make a sizable profit sum.

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Market – When will the sparks fly again globally?

Trading room – Mon 10 Dec 2018

Stocks dropped sharply on last Friday in US after a major rebound from the lows on Thursday, concluding what has been a wild week for Wall Street.

A weaker-than-expected jobs report and China-U.S. trade tensions sent the Dow Jones Industrial Average lower by 558.72 points to 24,388.95 and erased its gains for the year.

At one point, the Dow was up more than 8 percent for 2018.

Continue reading Market – When will the sparks fly again globally?
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Popularity on the rise for warrants over A50 ETF

Warrants Commentary (3 to 7 Dec)

Trading activity in warrants over the iShares FTSE China A50 Index ETF (A50 ETF) continued to rise last week, representing 21.3% of total warrants turnover, an increase from 15.6% in the previous week. The A50 ETF saw a volatile week, rising a total 4.1% over two days to close at HKD12.56 on Tuesday, as news broke on the US-China 90 day trade war truce. It thereafter fell a total 4.0% over the rest of the week amidst doubts on whether the trade differences can be resolved in time, ending the week at HKD12.06, unchanged week-on-week (w-o-w).

The most popular warrant over the A50 ETF was call warrant A50CHIN-C32, which saw 86.8mil units traded. The warrant tracked the underlying A50 ETF closely, rising 24.6% over the first two days of the week to RM0.430, and declining 22.1% over the rest of last week to finish at RM0.335. On the other hand, the most popular put warrant over the A50 ETF was A50CHIN-H27, which saw 54.5mil units traded. Put warrants move in an opposite direction to the underlying, increasing in value as the underlying declines.

In the meantime, the warrants market was once again dominated by the warrants over the Hang Seng Index (HSI), which comprised a still-hefty 63.7% of total warrants turnover. The HSI saw the same rise and fall as the A50 ETF last week, but closed down a steeper 1.7% w-o-w. With increased volatility, both the call and put warrants over the HSI were actively traded, though put warrant HSI-H4W topped the charts at 159.7mil units traded and call warrant HSI-C3W came in second with 143.8mil units traded. Investors net sold 16.7mil units of HSI-H4W, and snapped up 25.0mil units of HSI-C3W over last week, resulting in the issuer’s inventory of the call warrant HSI-C3W being completely sold out.

On the local front, the call warrant over Genting Malaysia (GENM), GENM-C42, emerged as the top traded warrant over a Malaysian counter last week. This warrant saw 27.1mil units traded, as GENM’s share price is still reeling after taking a blow from the cancellation of their planned Century Fox World theme park. The share price rose a slight 0.3% w-o-w to close at RM2.87 on Friday.

Top 5 warrants by volume traded:

Warrant name Volume
(mil)
Issuer Exercise level Expiry date
HSI-H4W 159.7 Macquarie 24,200 28 Mar 19
HSI-C3W 143.8 Macquarie 28,200 28 Mar 19
HSI-C3X 128.1 Macquarie 26,800 28 Mar 19
HSI-H4O 103.5 Macquarie 25,400 30 Jan 19
A50CHIN-C32 86.8 Macquarie 12.50 28 Jun 19

If you have any questions or need further assistance, please do not hesitate to email us at info@malaysiawarrants.com.my.

To view the full list of structured warrants available on Bursa Malaysia, kindly visit malaysiawarrants.com.my.

Provided for Malaysian residents information only. It is not an offer or recommendation to trade and is not research material. Past performance is not indicative of future performance. You should make your own assessment and seek professional advice.