My view as a Remisier is:

1.Since cut off time is 12.30,you should have cancelled the selling order before the afternoon session starts,or you could have stipulate the order as valid for half day only.

2.It is unlikely that the Remisier queue to sell a forced selling order.Normal industry practice is the company dealer handling the forced selling just throw to the buyer price.If you actually saw two orders (one matched and one queuing) at around 2.31pm(I presumed),that means your Remisier had keyed in one order and since not matched yet,he should have cancel the order when you called.

3.KNM at 0.265 yesterday?

KNM @.265 was just an example is was giving....

thanks 4 ur view, can u tell me, force selling starts at wat time? When should i have canceled the order? Y prior to this my remisier never told me to cancel any of my force sell orders, rather he just cancels it and keys in at any price that comes in....

in this case, how can i avoid the penalty to fall on me?? Already got losses from my counters, now i have to pay for some penalty im not even responsible off???????????

PLZ HELP!!!

Is this a real situation or just a hypothetical example?I am not sure of the actual facts so I can only give you general answers based on industry practice.

Forced selling time varies from one broker to another.If it was made known to you,you have to adhere to it.

You should cancel the selling order in the afternoon session since the forced selling by client is 12.30 pm.

You Remisier should have cancel his forced selling order when you called him to let him know that your own selling order already matched.


When you discovered the error,you could have talked to your Remisier yesterday to take remedial action,which means covering back the oversold quantity from he open market.in which case,the loss is only the price differential and the incidental charges of brokerage,clearing fee and commission.Today too late liao.

Try negotiating with him on the basis that he should cancel the second selling order when you called.Maybe sharing the loss is fair.

Penalty?

Just "buy-in" at 10 tick above to cover the short, which means 5 cents loss for each share.

I don't think online system has the ability to prevent people from short sell. Generally their system won't link with CDS one nor the system will check the CDS account first before allow you to sell.

For you case, both side also neglience on the issue. No offence.

Always can talk/discuss on the spot when the event happen just like what Iklatmy stated.

my remisier is old man already.... he's not good in IT.... i'll be meeting him next week to settle this issue coz im outstation and he's in KL...

btw, all my money stuck in this screwed up securities with remisier i cant communicate with...

just wondering, is there a way to refinance... if there is such a thing called refinancing...

Hi,

I need some help with Gearing
i've searched the FAQ and beginner's section but couldnt find the answer.

Investopedia defines gearing as
A fundamental analysis ratio of a company's level of long-term debt compared to its equity capital. Gearing is expressed in percentage form.
Companies with high gearing - more long-term liabilities than shareholder equity - are considered speculative.

While in wikipedia shows the formula to calculate gearing : debt to equity ration = D/E


1)Personally, I think it is good to look at gearing as well on top of PER, Is it a good practise or something redundant ?

2)Where can I find out a company's gearing? It is in most research papers, but most of the time getting the research paper for a particular company is the problem.

3)If I have to calculate gearing myself, can i use the formula from wiki ? I can get the debt value from financial report, what about equity ? Is equity the market capital of the company ?

4)Also, what does the gearing on warrant's page mean ? Is it the mother share's gearing or the warant's gearing ?

Thanks a lot..

This post has been edited by mopster: Aug 1 2009, 12:11 AM

This is not a beginner's questions...
1. Yes, definitely one of the consideration.
2. Because debt change when there is an increase/ decrease which company not obliged to inform shareholders from day to day, and equity value change which fluctuation of share price as well, no one might have the up to date figure for you (even CEO of the company also won't ask for that figure everyday, else the CFO pensan ). Normally take the reporting date one will do, some lazier even take the year end one.
3. Make it easy, take book value of the debt, exact figure should be taking market value of the debt, equity value depends on share price.
4. No idea, I seldom touch warrant

Warrant gearing has nothing to do with company debt issue.

Warrant gearing means how much the warrant able to gear on mothershare, ie. if mother share rise 10%, how much warrant fair value can rise in tandem with the mothershare.

The higher the gearing means you can achieve more gain in % in warrant compared to the mothershare.

Eg. a warrant price is 0.20, while exercise price is 2.00. Mothershare is 2.00

So whenever the mothershare rise 10 cents, warrant fair price also rise 10 cents.

But if you invested in mothershare you gain 5% , while for warrant it means a gain of 50%. So it has a gear ratio (or gearing) of 10.

If the warrant has little gearing ratio, it is not attractive. The higher the gearing, the more attractive the warrant is, but bear in mind, the exercise price also an important factor as well. As for high geared warrant generally higher exercise. Higher exercise price could means warrant is worthless if mothershare fall below the exercise price.

You need to consider on both front.

hmm..the Neon case is a very good learning experience until i m interested to share my opinions too..

Technically speaking, Neon should cancel his order in the noon. If the cutoff date is T+3 (430pm), he can still choose a price until T+4 (1230pm). Your online queue will have to cancel b4 the T+4 noon session start.

lklatmy was right tat he could have covered his oversold position on the same day. This was wat some of my frens were doing last time. Cover it b4 the end of the same session; as you can see sometimes why the index surge towards the closing.

For online trading, if i am not mistaken, the selling by the client and the force-sell by the dealer are different case..i mean they dont interfere with each other. That's why some brokerage firms have told their clients in the rules & regulations to refrain from selling on T+4. If selling is done in the morning by the client, then the client will have to inform his dealer rep.. this was wat i understood..

Feedback welcome.

errmmm ..please do help some noob question..

option 1 : buy counter A ..price go up then keep..then later average up
option 2 : buy counter A.. price go up..lock profit..then buy back the share at lower price(may miss the boat or end up in wrong boat).

which option is better? or is there better strategy?

I don't think anybody can answer you as there is no best or better strategy. It all depends on market trends and especially on your own expectation.

Option 1 - good strategy if the stock price keeps on going up
Option 2 - if the stock is volatile with lots of ups and down

In the end, nobody knows the future and either option can be a good or bad choice (on hindsight!).....

Option 1 : you must ensure your stock is fundamental sound over the long term.

Option 2 : most people think it is workable to maximise the profit, but in reality, most people stumbled on it. Gain a few ten cents but miss out a few ringgit of profit or go into pirate boat. Why?
Current situation is a good example, the market has nice run from March low to until now, consecutive 3-4 months time. If you opt the strategy, I can bet 90% of the people would already sold around April, so how can buy back at lower price. See how many people managed to buy KNM at its low around 30-40 cents, but most sold at around 50-60 cents with the hope to buy back later at lower price.

Main problem of this strategy, you try to time the market.

Option 2 is workable if the price indeed goes way beyond its fundamental suggesting aka way overvalued.

Cherroy explained well broadly on warrants. Traditional warrants normally have conversion ratio of 1 to 1. For CW, 1 to 1 conversion ratio represents highest gearing.

There are CW with zero gearing too because their exercise price is NIL. This kind of warrant normally has long expiry date. It has to relate to foreign mother share, buying CW therefore is no different from buying the mother shares except that CW expires one day, but not the mother shares. So, this kind of CW is trade at very low premium normally.

In Msia, we do not get to buy Put Warrant, Exotic Warrant (e.g with several expiry milestones; and final cash settlement amount is calculated based on all milestones. Each milestone locks in a value and forms part of the final settlement amount)

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Added on August 6, 2009, 1:12 amThere are many ways to trade, invest, speculate, etc. Shares are different things to different people. In the long run, the soundness of your judgement, containment of emotion, application of absolute objectivity, and most of all ,understanding of the biz/ shares you buy and of the economic cycle and sectorial performance define your success.

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Added on August 6, 2009, 1:16 amI notice most IT people buy shares without sufficient appreciation of what success in shares entails. Taking a course in economics, finance, accounting, etc certainly helps your odds against failure.

This post has been edited by CKC (Sense-Maker): Aug 6 2009, 01:16 AM

Option 1: only if the company's EPS has been growing year after year
Option 2: only if the share price is overvalued, but you've to check the company's historical PE also..otherwise you might sell too soon..

This post has been edited by DanielW: Aug 6 2009, 01:29 AM

oh great..thanks ..that really help...one last question..how do you calculate if the counter is under/over valued?

This post has been edited by lonewolf: Aug 6 2009, 08:32 PM

Hi, I have a question about dividends.

I see that some dividends are declared the following ways.

a. 7.5 sen single tier tax exempt dividend.
b. 10.0 sen dividend less 25% tax.

Both (a) and (b) also pays out a net of 7.5 sen. But why they announce it differently? Is it because in (b) we can claim back the tax credits?

Yes.

based on the PER (price to earning ratio) which normally measured in times...
if a company is over than 20x PER then that company is overvalued... less than 10x is undervalued...

this is only what i know...

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and i wanna ask something regarding warrants...

if i purchased some warrants, can i sell it back in the open market?
or i am not allowed to resell it and will have to exercise the warrant?

For PER, becareful using this figure as this figure is based on last year financial result, so it can sometimes misleading as well, as what we concern most is future down the road, not what happened previously.

Also there is no definite say 20x must be expensive or 10x is undervalued. It depended on lot of factors.

If FD interest rate is 10%, even stock at 10x PER is not undervalued. Undervalued/PER is a comparison figure which how much the stock can give return to investors.

PER 10x means company can generate 10% on your purchased share price. So if FD can earn you 10% at much lower risk, why investors want to look for 10% from the stock that carry higher risk one?

The reason why most people said 20x PER is overvalued, because it merely generate you 5% return rate which is too low for some risky asset for equities unless company can improve the EPS in the future.

That's what I believed when I was in secondary school, time passed, thing changed... (and that's almost 99% wrong ).

can.