Traders flock to FGV warrants as stock dives 12.3%

LAST week, plantation giant Felda Global Ventures Bhd (FGV) experienced a lacklustre performance. The share price kicked off the week in the red, plunging 8.6% as it closed at RM2.01 on Monday. It continued its downward momentum by adding 9.6% of losses for two days, Tuesday and Wednesday, before rebounding 6.6% to RM1.94 on Thursday. The share price, however, could not sustain its positive momentum, ending lower at RM1.93, a loss of 0.5% on Friday. For the week, FGV’s share price tumbled 12.3%.

Warrants over FGV grabbed limelight in the warrant scene, taking over the popular Hang Seng Index (HSI) warrants in the previous week. Warrants over FGV contributed about 15.8% of the total week’s warrant turnover. Among the lot, FGV-C16 and FGVC19 stood at the first and second rank in the top 5 most active warrants, with both recording total trading volume of 151.1 million units and 91.4 million units respectively. FGV-C19 which had investors buying 6.8 million units tracked its underlying closely, falling 41.7% as its bid price closed at RM0.070 to

Top 5 traded warrants end the week.

Call warrant AAX-CX, over AirAsia X, remained as investors’ favourite for three weeks in a row. Out of the warrants traded throughout the week, investors brought home 90.6 million units.

Over in the foreign index trades, the HSI was on a bearish trend, falling 1.1% week on week as the index finished at 22,642.62 points on Friday. On Monday, the volatile index inched down 0.1% before rising slightly above the 23,000 level on Tuesday at 23,147.07 points (+0.9%). The index, however, plunged 2.0% for the next two days before rebounding to close in the green on Friday.

Both the HSI calls and puts were actively traded by investors last week, registering 42.1% of overall warrants turnover. The call warrant, HSI-C48, which will expire in December, had investors buying 8.4 million units out of 83.6 million units traded. Among the HSI call warrants December expiry, HSI-C48 offers the highest effective gearing of 13.6x.

This means that, if other factors held constant, HSI-C48 tends to move about 13.6% for every 1% move in the HSI futures.

Elsewhere, investors also actively traded the HSI put, HSI-H63. whose expiry will be in January 2017. This warrant gained 5.8% and investors traded 61.0 million units.

To view the full list of structured warrants available on Bursa Malaysia, visit malaysiawarrants. com.my.

Provided for Malaysian residents’ information only. It is not an offer or recommendation to trade and is not research material. Past performance is not indicative of future performance. You should make your own assessment and seek professional advice.