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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
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

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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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Warrants over GENM traded up a storm

Warrants Commentary (26 Nov to 30 Nov)

Last week, the trading value of structured warrants increased by 10.4% to RM410.8mil. for the week as a result of active trading in warrants over Genting Malaysia (GENM).  The share price of GENM took a beating last Tuesday as its planned Century Fox World theme park hit a brick wall, potentially creating a Continue reading Warrants over GENM traded up a storm

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Hibiscus added to MSCI Global Small Cap Indexes

Warrants Commentary (12 Nov to 16 Nov)

Warrants over Hibiscus Petroleum (Hibiscus), an independent oil and gas upstream exploration and production company, were popular last week as news broke last Thursday (14 Nov) that Hibiscus was added to the MSCI Global Small Cap Indexes. The share price rose 5.9% in total on Thursday and Friday last week, ending the week at RM1.07. Continue reading Hibiscus added to MSCI Global Small Cap Indexes

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HSI puts actively traded in volatile market

Warrants Commentary (5 Nov to 9 Nov)

The Hang Seng Index (HSI) began last week on a bearish note, making a sharp U-turn from the surge in the week prior as the index tumbled 2.1% to 25,934.4 points last Monday. However, the HSI rebounded the following day, closing 0.7% higher as investors kept an eye on the US midterm election. After the election, the HSI rallied for the next two days, surging 0.4% in total to finish above the 26,000 level, before plunging 2.4% to 25,601.9 points on Friday. Continue reading HSI puts actively traded in volatile market

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Warrants over Sapura Energy in focus

Warrants Commentary (24 to 28 Sep)

We saw a drop in warrants turnover to RM291.3mil. last week, as investors chose to lay low ahead of the Federal Open Market Committee meeting last Wednesday (26 Sep), and due to the public holiday in Hong Kong last Tuesday (25 Sep). As expected, the Federal Reserve lifted its benchmark rate by a quarter point, increasing the fed funds rate to a range of 2% to 2.25%. Continue reading Warrants over Sapura Energy in focus

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HSI warrants heavily traded as index gained 2.4% w-o-w

Warrants Commentary (17 to 21 Sep)

Last week, the US-China trade war sharply escalated as the Trump administration announced that it is imposing another 10% tariffs on USD200 bil. worth of Chinese good, with effect today (Monday, 24 Sept). Following the announcement Continue reading HSI warrants heavily traded as index gained 2.4% w-o-w

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Warrants over HSI and Hibiscus in the spotlight

Warrants Commentary (27 to 30 Aug)

Last week, the Hang Seng Index (HSI) finally escaped the 27,000 level as the index kick-started the week on a bullish note, jumping 2.2% to close at 28,217.3 points last Monday. The index continued its strong performance, surging 0.5% on Tuesday and Wednesday, before losing 1.9% on Thursday and Friday to finish at 27,888.6 points. Despite the short week in Malaysia, trading over HSI warrants remained popular, accounting for approximately 80% of the total warrants turnover. Continue reading Warrants over HSI and Hibiscus in the spotlight