3 new CWs to be listed on Friday- PBB-CC, Tenaga-CE & YTL-CC

Tomorrow, we will have the listing of 3 new CWs i.e. PBB-CC, Tenaga-CE & YTL-CC. Their main terms are tabulated below, together with the terms of the existing related CWs for comparison purposes.



Looking at the above table, you will see 2 of the 3 CWs listed on Tuesday (April 3) i.e. PBBank-CB & YTL-CB, that were so mispriced by the market that they still attract a premium of above 20% (i.e. 25% for PBBank-CB & 33% for YTL-CB). The main reason for this mispricing is the public is not used to CWs with big exercise ratio- a problem which I have highlighted before. Well, the 3 CWs to be listed tomorrow will have equally big exercise ratio i.e. 10-to-1 for all 3 CWs and I am afraid that the public will again fall for these so-called 'cheap' CWs.