The Official Kenanga Warrants Blog
A Quick Guide to Cash Settlement on Expiry!
NagaWarrants
Publish date: Thu, 06 Jul 2017, 11:33 AM
NagaWarrants
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Official NagaWarrants Blog by Kenanga Investment Bank Bhd. We issue warrants to meet investors' demand for trading opportunities & alternative investments
This blog exists to offer quick updates & hopefully offer friendly, useful warrant info to achieve your trading goals.
Disclaimer: The info posted is for your info only & shall not be construed as an investment advice or solicitation to purchase. Please refer to the Base Prospectus & Term Sheets.
This blog exists to offer quick updates & hopefully offer friendly, useful warrant info to achieve your trading goals.
Disclaimer: The info posted is for your info only & shall not be construed as an investment advice or solicitation to purchase. Please refer to the Base Prospectus & Term Sheets.
A Quick Guide to Cash Settlement on Expiry!
A total of 12 warrants will be expiring on 13/7/2017 (Thurs).
What dates must I know?
Last trading date: 5pm @10/7/2017
Suspension date: 9am @11/7/2017
Expiry date: 9am @13/7/2017
What happens on expiry?
If your call warrant expires In-The-Money (ITM), it will automatically be exercised. A call warrant has value at expiry if the Cash Settlement price is above the Exercise price.
In contrast, a call warrant with a Cash Settlement price equal to or lower than the Exercise price will expire worthless. This is known as Out-Of-The-Money (OTM).
Here's an EXAMPLE calculation for Cash Settlement Amount.
Assuming you purchased 100,000 GENM-C18 warrants.
Exercise price: RM5.00
Exercise ratio: 3.5 warrants to 1
Cash Settlement Amount
= Number of GENM-C18 exercised x [(Cash Settlement Price - Exercise Price) / Exercise Ratio ]
= 100,000 x [(5.72-5.00) / 3.5]
= 100,000 x RM0.2057 per warrant
= RM20,570 approx
Assuming you purchased 100,000 GENM-C18 warrants.
Exercise price: RM5.00
Exercise ratio: 3.5 warrants to 1
Cash Settlement Amount
= Number of GENM-C18 exercised x [(Cash Settlement Price - Exercise Price) / Exercise Ratio ]
= 100,000 x [(5.72-5.00) / 3.5]
= 100,000 x RM0.2057 per warrant
= RM20,570 approx
* The Cash Settlement Price of RM5.7200 is the average daily volume weighted average price (VWAP) of the ordinary shares of GENM for the five (5) market days prior to and including the market day immediately before the Expiry Date.
* The Cash Settlement Amount will be delivered to the warrantholders by ordinary post within seven (7) market days from the Expiry Date.
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Disclaimer: Investments involve risks, including possible loss of principal and other losses. These articles and charts are provided for information only and should not be construed as as a solicitation to buy or sell any of the instruments mentioned herein. The author shall not be responsble for any losses or lost profits resulting from iinvestment decisions based on the use of the information contained herein. If investment and other professional advice are required, the services of a licensed professional person should be sought.
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