Practice Makes Perfect

Company Warrants Trading at Discount!?

Chin Kok Tan
Publish date: Thu, 11 Aug 2011, 11:51 PM
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CK>> DISCOUNT! Everybody like discount especially in share market. Whenever there is a share trades at discount, investors sure will rush into position to grab it.

I have been watching these three company warrants, 3 of them always trade at discount compared to their intrinsic warrant values. But sometimes they will sudden shoot up to get near to their intrinsic value and trade at minor premium, but most of the time, they are in discount state. Worth to point out that the expired date for 3 of them are still far more to go and no dividend has yet to announce in these period.

You can easily find out that many investors are rush in, excise the warrant and then immediate sell off after conversion.







CK>> Two possibilities for the warrants to trade at its intrinsic value:
1) Mother share price drop while warrant share price maintain!
2) Warrant share up while mother share price maintain!
So, what do you think?

Among these 3 warrants, KPJ-WA is in the best position now, trade at 29 cents discount to its intrinsic warrant value. Erm... What should I do now:
1) Buy and wait for warrant share price to shoot up? But what happen if it doesn't?
2) Buy, exercise and sell after conversion? What happen if mother share price drop during that conversion listing period?

Do you own judgement! Happy birthday to myself in another 10 minutes. Hohoho~

Discussions
2 people like this. Showing 1 of 1 comments

laiseng012

good comment, happy birthday to you..

2011-08-12 06:50

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