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Warrants over HSI a whopping 74% of turnover

Warrants Commentary (4 Jun to 8 Jun)

Warrants over the Hang Seng Index (HSI) continued to be the focus of investors as it racked up close to 74% of the total RM756.5 mil. traded last week.  The HSI futures were positive for most of the week, with a strong 1.7% start on Monday.  The volatile futures continued on its upward momentum up until Thursday, where it closed at 31,535, representing a 3.8% gain for the week.  However, markets took a turn on Friday as investors were wary about the impact from the listings of Chinese big-cap “unicorn” companies and uncertainty over trade relations.  The HSI ultimately closed up 1.5% week-on-week (w-o-w) to end the week at 30,840.

HSI warrants dominated the top 7 warrants for the week as investors switched between the call and put warrants.  Among the popular warrants over the HSI, call warrant HSI-C3E emerged up top with a whopping RM145mil. traded.  From Monday to Thursday, the warrant rose from RM0.395 to RM0.570, representing a 44.3% increase.  On Friday, tracking the underlying closely, the warrant fell 23.7% to end the week at RM0.440.  HSI-C3E is one of the most sensitive warrants over the HSI, as it moves 1 tick for every 28 points move in the HSI futures.  This could be one of the key reasons why it was the top warrant for the week.

In single stock warrants, My EG Services Bhd (MYEG) remained in the spotlight as it continued on its rollercoaster run.  The share price fell 20.4% to RM0.685 on Monday, but recovered to end the week at RM0.855, a mere 0.006% lower w-o-w.  Among the many warrants over MYEG, MYEG-C40, with an exercise price of RM1.20, was the top warrant.  MYEG-C40 remains the most liquid warrant, which generally makes it easier for investors to get in and out of trades without affecting the warrant’s price.  On Friday itself, the warrant gained 20% to close at RM0.120, unchanged w-o-w.

Another warrant over single stocks that made the cut was SAPNRG-C65, a call warrant over Sapura Energy Bhd.  The underlying share price recovered last week, gaining 8.5% w-o-w to close at RM0.635, whereas SAPNRG-C65 moved up 17.6% w-o-w to RM0.100.

 

Top 5 warrants by traded value:

 

Warrant name Value

(RM’mil)

Issuer Exercise level Expiry date
HSI-C3E 144.9 Macquarie 31,800 30 Aug 2018
HSI-C3B 125.4 Macquarie 31,200 30 Jul 2018
HSI-H4E 123.9 Macquarie 29,400 30 Aug 2018
HSI-C3J 47.6 Macquarie 33,400 29 Nov 2018
HSI-H4C 36.3 Macquarie 30,200 30 Jul 2018

 

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.

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