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High demand for the new DNEX call warrant

The Malaysia warrants market recorded a 6.3% increase in trading activity last week with a RM137.2mil turnover. Zooming further into the turnover composition, Malaysia stock warrants posted a lower turnover at RM69.0mil while warrants over indices saw a surge in interest
macquarie structured warrants 20200914

The Malaysia warrants market recorded a 6.3% increase in trading activity last week with a RM137.2mil turnover. Zooming further into the turnover composition, Malaysia stock warrants posted a lower turnover at RM69.0mil while warrants over indices saw a surge in interest with RM50.0mil traded which can be attributed to the higher volatility in global equities in the past week.

Dagang NeXchange (DNEX) is one of the top advancers on Bursa Malaysia this year with a staggering 282.2% gain year-to-date (YTD). The strong share price performance can be attributed to the positive development in the company recently which includes the Ping Petroleum stake increase and the SilTerra Malaysia acquisition alongside its strategic Chinese partner (The Edge Markets, 8 Jun). Call warrant DNEX-CA was crowned the top traded warrant last week with RM18.0mil in turnover as it is the first ever call warrant listed over DNEX. Due to popular demand, this call warrant may be low on inventory. Warrants which are sold out by the issuer (or close to being sold out) may see its market price moving higher than its fair price due to other investors queuing in the market. 

Besides, the share price of V.S. Industry (VSI) finished at a two-month high (RM1.45) on Friday following its highest ever quarterly profit announcement last Wednesday (The Edge Markets, 16 Jun). Bullish investors were actively trading VSI calls, among which VS-C43 emerged as the most popular one with RM5.4mil traded followed by VS-C50 which saw RM1.5mil traded. In comparison to VS-C43, VS-C50 is two months longer dated with its absolute warrant price being 5sen lower.

Meanwhile, the Hong Kong market had a rollercoaster ride last week as the HSI June futures finished lower on the first two trading days of the week before rebounding from the weekly low (28,088) on Thursday and finishing above the 28,700 level on Friday. Bullish investors collected call warrants HSI-CFN and HSI-CFQ early last week and subsequently took profit on their positions as the index futures rebounded on Thursday and Friday. On top of the two call warrants, put warrant HSI-HGN was another HSI warrant which appeared on the top warrant list with RM7.5mil traded.

Top warrants by value traded:

Warrant nameValue (RM’mil.)IssuerExercise level/priceExpiry date
DNEX-CA18.0RHB0.9028 Mar 2022
HSI-CFL12.0Macquarie29,00029 Jun 2021
HSI-CFQ9.8Macquarie29,60029 Jul 2021
HSI-HGN7.5Macquarie28,00029 Jun 2021
VS-C435.4Kenanga1.2429 Sep 2021

If you have any questions or need further assistance, please do not hesitate to contact us via our hotline at 03-2059 8840 or email us at [email protected]

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

Provided for Malaysian residents information only. This commentary has not been reviewed by the Securities Commission Malaysia. 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. The Warrants will not be offered to any US persons.

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