FGV back in spotlight as mother share hits 4-month high
LAST week, the spotlight was on Felda Global Ventures (FGV) on news that Datuk Zakaria Arshad will resume his duties as FGV’s president and CEO, effective today. For the past few months, FGV has been in turmoil after Zakaria and three other executives were put on leave of absence by the group’s board as it investigated transactions made by its subsidiary, Delima Oil Products.
Following the news of Zakaria’s return, FGV’s share price made a comeback last week, gaining a total of 6.9% from Monday to Wednesday and hitting a four-month high at RM1.83. The share price thereafter fell 1.6% to RM1.80 on Thursday before rebounding 1.7% to close at RM1.83 on Friday.
The strong momentum in FGV shares prompted investors to heavily trade the call warrant over FGV, FGVC30, which ended the week with a total volume of 16.8 million units. Investors who previously bought this warrant were seen cashing in, selling back 3.5 million units at the end of the week. FGV-C30 gained a whopping 23.8% week on week to RM0.130.
The longer dated warrant, FGV-C37 (which expires on Jan 30, 2018), also saw active trading, with 12.8 million units changing hands. Longer dated warrants typically have lower gearing levels than shorter dated warrants and will experience slower time decay. Therefore, all other factors held constant, they tend to be of lower risk than warrants with shorter expiries.
In other news, demand over the call warrant of Sapura Energy, SENERGYC46, remained robust as it maintained its position at the top spot for two consecutive weeks. On Monday, investors took home 1.6 million units of SENERGY-C46, taking advantage of the decline in the warrant’s bid price, which fell 10.0% to RM0.045. Investors were then seen selling back 7.2 million units of the warrant for the rest of the week as its bid price fell another 11.1%, finishing at RM0.040 on Friday. Its mother share, Sapura Energy, fell 2.0% to RM1.46 week on week.
Meanwhile, for foreign index underlying, the Hang Seng Index (HSI) continued to be bullish as it maintained its level above 28,000 points. Despite trading in the red on Monday, the index managed to end the week in positive territory, inching up 0.1% as it closed at 28,476.43 points on Friday.
The HSI warrants trading volume picked up from the previous week, rising 31.4% to 16.6 million units in total. Its turnover also rose, gaining 38.5% to RM9.8 million. The HSI put, HSI-H2Q, was the most popular HSI warrant for the week, with investors trading more than 7.4 million units as its bid price fell 7.1% to RM0.455.
To view the full list of structured warrants available on Bursa Malaysia, kindly 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.