Hi, who hv the idea or view on this two warrants??

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Added on October 5, 2009, 3:20 pmStock Code : 0539C1
Stock Short Name : GENS-C1
Issue Size in Unit : 150,000,000
Maturity Date : 02/09/2010
Exercise/ Strike/ Conversion Price : SGD 0.9376
Exercise/ Conversion Ratio : 2.8703 : 1
Settlement Type/ Convertible into : Cash

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Added on October 5, 2009, 3:21 pmStock Code : 0539C2
Stock Short Name : GENS-C2
Issue Size in Unit : 90,000,000
Maturity Date : 25/08/2010
Exercise/ Strike/ Conversion Price : SGD 1.0600
Exercise/ Conversion Ratio : 6:1
Settlement Type/ Convertible into : Cash
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Stock Short Name : GENS-C3
Issue Size in Unit : 160,000,000
Maturity Date : 04/10/2010
Exercise/ Strike/ Conversion Price : SGD 1.0800
Exercise/ Conversion Ratio : 4 : 1
Settlement Type/ Convertible into : Cash

This post has been edited by paylink: Oct 6 2009, 11:40 AM

These two document explain what it is.
I suggest you try to read and understand it.
If not you may ask again may be someone or me can try to explain it

http://www.osk188.com/pageW.jsp?name=sw_understanding

https://admin.osk188.com/adminv2/UserFiles/...erm_gens-c2.pdf

yup, i read the pdf file before, but still dunno how to calculate the current warrant price compare to the mother share price..
can teach me how to calculate??

thanks a lot

OK this is tough...
Any how I will try to simplify it.

GENS..Genting Singapore is not listed at KLSE but in Singapore Exchange quoted in Singapore dollar (SGD)
Taking the example of GENS-C2
The share price at the time of issue is SGD1.17 or RM2.87 using 2.4535 rate
The strike price price is SGD1.07 or RM 2.63 (strike price is the price that that you can buy the share or in this case will be the base price to calculate your gain if any at the expiry date of 28 August 2010)
OSK had sold this warrant in small pieces of One sixth each

In warrant like option there are 2 values we have to consider.. The true or intrinsic value and the time value.

Take this example:

The issue price is RM0.15 for 1/6 so equal to RM 0.90 for the full share
The intrinsic value is RM2.87 less RM 2.63 equal RM0.24
So the time value to expiry 28 Aug 2010 (11 Months) is RM0.90 less RM0.24 equal RM0.66 or RM0.06 per month

Say after one month or 01 Nov 2009
GENS share price had gone up to SGD2.16 or RM 5.30 assuming that the exchange rate had not changed
Intrinsic value RM2.67
time value RM0.06 time 10 month left . equal RM 0.60 the new value for the full share equal RM3.27
The call warrant should now be 1/6 of RM3.27 around RM0.54 for a profit of RM 0.39 or 260%

Say after 2 month 01 Dec 2009
GENS share price drop to SGD 0.70 or RM1.71
Intrinsic value - RM0.92 intrinsic value couldn't be negative so we consider RM0.00
The time value is RM0.54
so the call warrant shouldn't exceed RM0.09 for a loss of RM0.06 or 40%

Say on 25 Aug 2010

GENS share price is SGD 1.20 or RM2.94
The intrinsic value RM0.31 and time value RM0.00
We will be paid RM0.05 per call warrant for a loss of only RM0.10 or 67%

(To come out with the time value involved complicated calculation using the share volatility. I was told that the 2 persons who had come out with the formula to calculate the time value had being awarded with a Nobel prize )

This post has been edited by rosdi1: Oct 5 2009, 11:08 PM

Wow, u r so great to come out this calculation
I hv calculate it and found out that the GENS C2 only value for Rm0.11 , but still the price is catching up at Rm 0.19 today
And with the price of Rm0.19, the mother share should reach S$1.26~ S$1.27 right??

Well, i think market is excited with the GENS opening early next year, so everyone is holding the share and push up the price

Thanks for your help anyway

This post has been edited by paylink: Oct 6 2009, 01:41 AM

There is another factor with the call or structured warrant which can influence the price initially.
The issuance was not done like an IPO where the share are offered at the IPO price before the listing instead all the call warrant was initially held by the issuing house.
When the volume is so small like what is happening here I am always so suspicious that the issuing house are trying to get a higher price than it was initially offered. Rightly the issuing house should still try to dispose all the warrant up to the offer price instead of holding to it hopping for a higher price for a higher profit. This is not very fair to the investor.

Rightly the price shouldn't move up before all the call warrant had being disposed by the issuing house.

We couldn't change the rule of the game but we have our choice

one more warrant come out today

This post has been edited by paylink: Oct 6 2009, 11:39 AM

Yes this time from CIMB my broker but the same story.
I think they are not doing it right. It should be sold at RM0.18 the issue price when the pick up is very very low.
Sorry I am very suspicious on this.

yup, agree with that..
as now alr got 3 warrants in the market, the investment from public ll dilute to diff counter, not easy as C1 before

this warrant,we can claim mother share when reach the expired date ??? how to count to win rate??

either this warrant only will loss ??