20th January 2011

Bursa red today, how is it going to be for tomorrow? Hope all the best for comrades. Also, I Q 11.5 for genm, didn't know kena few hundred lots. Hope fatt tat next week.

What goods you guys holding? Hope tomorrow you guys relax lah, no trading la tomorrow

Hi guys,

Since i am new here, i wonder if we have, or we can have a topic for the newbie to ask some basic question on warrant...
Actually, i have some questions here, hope u all dun mind.

I wonder how u all calculate the latest premium of the warrant. Do u all have set the formula so that when the price change u key in the warrant price and mom price to get the latest warrant premium? Or there are reference that we can check directly? and also, can someone give an example of calculating new premium of the warrant when the mother price change

Where can i get the info on all warrant like its ratio, expire date and etc?

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Hi there Kongol, great to see that you have posted any doubts or questions here. Feel free to post more so that we can answer your doubts here. Although I am not Max himself, but I might be able to answer your question myself and if you have any doubts, please feel free to post again so that others can answer.

When trading, we don’t calculate the premium ourselves. Our trading platform (in which this case, excelforce trading platform) calculates it automatically for us, allowing us to make split decision making whether to sell or buy. Remember trading call warrants are all about speed. A split second can make a profit or loss position. If you want to have a list of call warrants, you can check out bursa websites under structured call warrants, they have a list of call warrants with price, conversion ratio, exercise price as well as exercise date.

You can calculate premium based on the formula:
Mother price – [(BB price x ratio) + Exercise Price] = Premium / Negative Premium

For example, Netsoft Corporation’s share price is $5. Current BB price is 10 cents each and conversion ratio is 10 BB for 1 mother share. Exercise price is $4. Therefore:

$5 – [(0.10 x 10) + $4] = 0

In this case, there is zero premium.
If more than zero, then there is a premium.
If there is negative figure, then there is negative premium.

Hope I answered your questions.

By the way if you are using excelforce, I can teach you how to change the column to reflect all important information.

Netsoft wrote:By the way if you are using excelforce, I can teach you how to change the column to reflect all important information. [You must be registered and logged in to see this image.]

Thanks for ur info netsoft [You must be registered and logged in to see this image.]
i remember sifu max saying that the warrant will tend to go back to zero premium...so this mean the higher premium the warrant is, the better? right??

Btw, i dun really know about excelforce, is that a software? [You must be registered and logged in to see this image.]

kongol wrote:

Netsoft wrote:By the way if you are using excelforce, I can teach you how to change the column to reflect all important information. [You must be registered and logged in to see this image.]

Thanks for ur info netsoft [You must be registered and logged in to see this image.]
i remember sifu max saying that the warrant will tend to go back to zero premium...so this mean the higher premium the warrant is, the better? right??

Btw, i dun really know about excelforce, is that a software? [You must be registered and logged in to see this image.]

You must understand the relationship between premium and maturity/expire date. If a bb is nearing it's expiry date, it has the tendency to optimize itself to reach 0% premium. The lower the premium, the better a BB is, but is still depend on many other factors.

Excelforce is a trading platform. If you have the following trading screen, then you are using excelforce.

[You must be registered and logged in to see this image.]

Feel free to ask more questions.

netsoft you trade futures too?

Samseng wrote:netsoft you trade futures too?

Nope

wow .. today also got new thread even bursa is not trading ...
for foreign stock market bb trading kah? [You must be registered and logged in to see this image.]

bernardlcn wrote:wow .. today also got new thread even bursa is not trading ...
for foreign stock market bb trading kah? [You must be registered and logged in to see this image.]

Nolah, for us to ask questions

today regional sentiment looks not so good ... haiz [You must be registered and logged in to see this image.]

most probably tomorrow will be red as well...dare not expect too much haih

Netsoft wrote:

kongol wrote:

Netsoft wrote:By the way if you are using excelforce, I can teach you how to change the column to reflect all important information. [You must be registered and logged in to see this image.]

Thanks for ur info netsoft [You must be registered and logged in to see this image.]
i remember sifu max saying that the warrant will tend to go back to zero premium...so this mean the higher premium the warrant is, the better? right??

Btw, i dun really know about excelforce, is that a software? [You must be registered and logged in to see this image.]

You must understand the relationship between premium and maturity/expire date. If a bb is nearing it's expiry date, it has the tendency to optimize itself to reach 0% premium. The lower the premium, the better a BB is, but is still depend on many other factors.

Excelforce is a trading platform. If you have the following trading screen, then you are using excelforce.

[You must be registered and logged in to see this image.]

Feel free to ask more questions. [You must be registered and logged in to see this image.]

Thanks netsoft, i have some more question,
1) Why is lower premium the better bb? is this means this kind of bb respond closely to mom movement that its premium is always near zero? Coz at first i tot that higher premium means bb will up more to adjust the premium back to zero [You must be registered and logged in to see this image.]

2) What is the criterias for the buy call? First choose a good bb (nearly zero premium bb) and check the b q of the mother??

3) last but not least, when do v sell or when do v cut loss? based on what condition? Is the mother condition the main criteria? like when pple start selling large stock of mother then v need to ciao? Still new here, hope u all dun mind correcting me [You must be registered and logged in to see this image.]

Btw, i am using maybank investment...i guess the it is also excelforce..

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kongol study this

maxims wrote:[You must be registered and logged in to see this link.]

kongol study this

Thanks Max [You must be registered and logged in to see this image.]

kongol wrote:

maxims wrote:[You must be registered and logged in to see this link.]

kongol study this

Thanks Max [You must be registered and logged in to see this image.]

study all article in the blog..if u really keen to trade bb full time one day

world market getting more holland

luckily i bought few counter and no focus on 1 or 2....holding too much qty on more counter is disastrous during market down time but can hit jackpot during market chiong time

maxims wrote:

kongol wrote:

maxims wrote:[You must be registered and logged in to see this link.]

kongol study this

Thanks Max [You must be registered and logged in to see this image.]

study all article in the blog..if u really keen to trade bb full time one day

Max,
I will try my best. Now still learning the basic knowledge on bb..
I go through the article and need to ask some questions here.

1) what does it means by bid spread?
2)For a sensitive BB, does it respond immediately with mom movement? say the 2:1 ratio, when mom up 10cent, it up 5 immediately, or it might up not up 5 cent immediately but it follow eventually?
3) Last question, I been wondering about this, since the bb has a ratio relation with mom, does this mean that for a responsive bb, when mom price up, it up bcoz it respond to its mom, not bcoz of got buyer buying at that price?