CWs have done well

There has been no Call Warrant ('CW') issued since my last post on the subject on April 7. With the unexplainable exception of 2 BJToto-CWs (i.e. BJToto-CD & BJToto-CE), all CWs have enjoyed healthy price rise. The price of BJToto-CD & BJToto-CE dropped by 9% & 5%, respectively.

I have highlighted those CWs with conversion premium of less than 10% (in green) as well as emboldening the expiry date of those that will expire within 2009. Finally, I have highlighted in yellow the amended terms for Maybank-CJ and Axiata-CB (affecting their exercise price & ratio) due to their recent Rights Issue.



It is interesting to note that the conversion premium for most of the CWs are quite reasonable, except for Maybank-CJ and Axiata-CB and those that are deeply out-of-the-money (i.e. AMMB-CB & IOICorp-CI). Why are issuers not coming out with new CWs now? I don't think it is a question of demand, but more a matter of risk management. To issue a CW when the market is on the verge of a bull rally is not terribly smart.