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HSI-HGK dominates the warrants market

The Malaysia warrants market saw a total of RM233.3mil traded on the second week of April, which is 15.4% higher than RM202.1mil in the prior week. Out of which, the warrants over Malaysian underlyings were the largest contributor with RM167.4mil traded (71.8% to the total turnover) followed by warrants over the Hang Seng Index (HSI) with RM56.3mil traded (24.1% of total turnover) as the Hong Kong market was shut on Monday and Tuesday.
macquarie structured warrants 20200914

The Malaysia warrants market saw a total of RM233.3mil traded on the second week of April, which is 15.4% higher than RM202.1mil in the prior week. Out of which, the warrants over Malaysian underlyings were the largest contributor with RM167.4mil traded (71.8% to the total turnover) followed by warrants over the Hang Seng Index (HSI) with RM56.3mil traded (24.1% of total turnover) as the Hong Kong market was shut on Monday and Tuesday.

The share price of Malaysian telecommunications company Digi.com (DIGI) surged 18.9% on Friday (9 Apr) following an announcement that Axiata Group and DIGI’s parent company Telenor are in talks on merging their Malaysian operations to form Celcom Digi Berhad (The Edge Markets, 8 Apr). Investors gained leveraged exposure to DIGI shares via call warrants, with DIGI-C45 emerging as the most popular DIGI warrant with RM16.9mil traded last week. Besides, glove maker Top Glove Corporation also saw one of its best weeks since late September 2020 as the share price finished 10.1% higher week-on-week (w-o-w).  TOPGLOV-C1L was the most popular TOPGLOV call warrant last week, with bullish investors taking home 6.0mil units as the bid price finished 23.5% higher.

Investors also showed vast interest in HSI warrants, namely call warrant HSI-CFK and put warrant HSI-HGK as the Hong Kong market resumed trading on Wednesday (7 Apr) after a 5-day long weekend. It was indeed a choppy week for the Hong Kong market as the HSI April futures finished flattish last week despite the 1.4 to 1.7% intraday movement. The rangebound movement between 28,168 and 29,148 in the HSI futures has presented opportunity to investors to trade in either directions. With a total of RM30.7mil turnover last week, HSI-HGK emerged as the most popular warrants on Bursa Malaysia for the week. Bearish investors bought more than 22M units of this put warrant on Thursday (8 Apr) when the HSI futures traded above 29,000 level, and subsequently sold back their positions with up to a 19.1% gain as the HSI futures finished at 28,634 on Friday (9 Apr). Meanwhile, call warrant HSI-CFK, which saw RM14.3mil traded, came in fourth on the top traded warrant list.

Top warrants by value traded:

Warrant nameValue (RM’mil.)IssuerExercise level/priceExpiry date
HSI-HGK30.7Macquarie27,00028 May 2021
DIGI-C4516.9Ambank4.3021 Oct 2021
MYEG-C1H14.9Kenanga1.2012 Apr 2021
HSI-CFK14.3Macquarie31,00029 Jun 2021
TOPGLOV-C1L12.5Macquarie4.888 Oct 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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