guys, for Dividend Reinvestment Plan (DRIP) in Malaysia, where does the company get the shares to issue to those that participate in the DRIP?

is it from their share reserves? or does the broker purchase directly from the market and reissue them?

My 3 cents here from my learning journey.

3 important core jobs of management:
* making profit, thus PTPM (either flat or increasing)
* able to make more $ from their retained profit, thus ROE (better than 15%)
* not taking too much debt, thus D/C (less than 33%).

Cheerio.

Company will issue new shares for DRIP, dilute other shareholders who did not opt for DRIP.

got it thanks.

Edited.

This post has been edited by Mr Kong: Jan 8 2014, 12:24 PM

Gark, can you please answer my question
Can you please tell me why do some warrants trade below their mother share price?
For example: SKP-HA and SKP-CS both have the same expiry date but one HA is trading at a 10% discount compared to its mother share whereas CS is trading at a premium of 9%
Why is there such difference??
Thanks!!

SKP-HA is a put warrant.. which means it expect the shares to DROP to earn money

SKP-CS is a call warrant.. which means it expect the shares to RISE to earn money

They are not the same one trade at negative premium and one at positive premium. Best you study carefully on the strike price, ratio and leverage before you buy. Buying call and put warrant without knowing how to count all the info is a sure fire way to lose your pants...

Name | Type | Issue | Expiry | Strike | Ratio | premium | Leverage
SKPETRO-CS | Call Warrants | 25/10/2013 | 24/10/2014 | 3.80 | 6:1 | 0.44 (9.46%) | 3.604
SKPETRO-HA | Put Warrants | 25/10/2013 | 24/10/2014 | 3.80 | 6:1 | 0.40 (8.60%) | 10.333

This post has been edited by gark: Jan 8 2014, 01:07 PM

But let's say i expect shares of SKP to rise in the future, can i still buy put warrants?
For the HA put warrant, the exercise to conversion ratio is 6:1, so with the current price of 0.075 so it's 0.45.
The exercise price is 3.80. so 0.45+3.80=4.25.
The maturity date is 24/10/2014, so let's say at 24/10/2014, the share price of SKP goes up to RM5, then what happens??

Put warrant you only earn money if the SKP share is on downtrend...If you expect SKP shares to go up, buy call warrants...

Read the warrant issue documents on the settlement calculations. Your calculations is all wrong...

http://www.bursamalaysia.com/market/listed...arrants/1441373

For put warrants the calculation is :- (Exercise price - settlement price )/ratio = settlement amount per share

IF you expect SKP to go to RM 5 then... (3.8-5)/6 = -0.20 = 0

If you expect SKP to go down to RM 2 then ...(3.8-2)/6 = 0.30 cash upon expiry date

Now the market price is 0.075 x 6 = 0.45.. you will only breakeven IF the SKP price is 3.80-0.45 = 3.35

Really you should not touch warrants....unless you have full understanding on the calculations

This post has been edited by gark: Jan 8 2014, 03:26 PM

But SKP shares are quite expensive.
If play warrants, wouldn't the ROI be better?

Yeah .. and lose your pants faster too...due to the leverage.. anytime can 100% loss one especially you cannot calculate yet want to play...

You buy mother shares you think can 100% loss or not?

This post has been edited by gark: Jan 8 2014, 03:30 PM

Anyone using OSX here?
Just wondering any platform support OSX?

Gark, I was too blur.
So these 2 are more straight-forward warrants rite?
WCT-WC (9679WC) and WCT-WD(9679WD)
For WCT-WC, the conversion price is 2.04+0.43=2.47( as of 10/1/2014) 4:27pm.
So it doesn't matter whether the share goes up or not rite?
Because the mother share price too expensive, I am thinking of buying warrants..
Do tell me if i am wrong.
Thanks Gark!

WCT-WC Warrants 08/07/2013 10/03/2016 2.04 1 Warrant : 1 WCT Share 0.275 (12.55%)

12.55% premium.. you sure you want to buy?

What do you mean doesn't matter the price go up or not? The warrant price will change with the share price.

This post has been edited by gark: Jan 10 2014, 05:53 PM

I just open an account at HLebroking
surprised that he told me no charge for that
but dont like that guy attitude :/
anyway i am just planning to do transaction online so doesn't matter right? since not going to contact with him

Dont like then change broker lo.... customer comes first mah...

but can this be done via phone?
talking to him personally quite awful

btw may i know how come its free instead of RM10

Sometimes broker adsorb the charges to get more customers.

If no good working relationship , mah change broker lah... many many choice for you to choose.

Gark, thanks for helping me regarding the WCT one.
But i have another question here.
What can one do during pre-opening hours in Bursa?

Enter queue for your shares. That's it.