Well today we dicuss about the call and put warrant. 

Why the call warrant is good , why the call warrant is bad?

Let me explain how does the call warrant works.

Call warrant and the put warrant is the warrant which issue by the third party bank like AMBANK, MAYBANK, KENANGA, or the most famous MACQUIRE which the mother company itself dont have any relation between it.

In fact, this is a very dangerous warrant which can rise very fast and down very fast ( i also has been burned before). 

In this case, the calculation is a very important part to choose a right call and put warrant. Lets see how to calculate the call warrant

Lets get the inari as the example,

INARI 

Current price of the INARI IS 4.83

Lets get the INARI-CN as the example

KLSE : INARI-CN

Last Price	Today's Change	Day's Range	Trading Volume
0.255	+0.015 (6.25%)	0.24 - 0.26	126,000

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Overview

The true value of a warrant is calculation by (mother share price - exercise price) / ratio

In this case, the value of the CN should be 4.83 - 4 = 0.83 / 5 = 0.166

The true value of the CN is 0.166 , but the current price of the 0.255 , which the price expensive than their true value of 53%. If pick this kind of warrant, you must bear the 53% more expensive price to eat it. This kind of call warrant is what we called as waiting die if the inari not rocket up like no tomorrow.

Lets see about MPI-CA

Mother price now is 9.7

Overview

calculation by (mother share price - exercise price) / ratio

9.7 - 7.05 = 2.65 / 6 = 0.441, which the current price of the 0.445, this is what we called as healthy warrant because the gap of the price is not big different. In this case, if we want to buy a call warrant, we must do the calculation before we buy it.

However, the expiry date of the call and put warrant is very fast in this case the call warrant should not be pick up more than 3 days, the call warrant and the put warrant value will be depreciate over the time , since the expiry date nearer, the warrant holder will throw away the warrant since the gap is big, in this case, the expiry date is a very big concern to buy a warrant. 

However, a knife can save people, also can kill people. Same as warrant, if you manage well you can earn very much, if u manage not well , u will lose a lot of money. there is nothing wrong for the warrant, is the wrong of the people who buy the warrant. So please make a good judgement before you buy the warrant.