Posted by passerby > 2012-10-30 21:34 | Report Abuse

gearing = underlying price / ( warrant price x exercise ratio )

it is a measurement of how many number of underlying equivalent you can purchase with a unit price of the underlying

for Sime-CR, gearing should be = 9.80 / (0.04 x 8 ) = 30.6 times theoretically. However, the effective gearing ratio could be less

high gearing = high leverage exposure. 1 tick of movement, you will see a significant % of gain or drop. It always associated with high risk

If you see the mathematical equation, high gearing happens when
:-

a) all parameters the same ( warrant price & ratio ) but underlying price went higher = means warrant trading at low premium or discount

b) all parameters the same ( underlying & ratio ) but warrant price went lower = means warrant is deeply out of money

* notes, exercise ratio is a constant, you can safely ignore it in your analysis on the mathematical equation.

You can do the rest of the analysis on your own from here :)

if this continue, sooner or later, all the fundamental kakis become punters kaki already

Posted by pirate99 > 2012-10-30 21:36 | Report Abuse

Thanks passerby..

Posted by Mat Cendana > 2012-10-30 23:09 | Report Abuse

Yeah, I was a purely fundamental investor just some months ago. Then it became more of a trader but decisions are still based on fundamentals. At the moment I have diversified - a certain percentage of the capital goes to higher risk trades that include warrants. With this category, good fundamentals are nice but the more important element would be "buy on speculation"... and get out when things move to a certain point. Thanks for the explanation - now those gearing numbers in The Edge finally mean something:-)

Posted by kcchongnz > 2012-10-31 05:14 | Report Abuse

passerby gave a good explanation of what gearing is; ie gearing is the ratio of the underlying share and its option which is made up of 8 units of CR. At yesterday's closing prices of Sime and CR at 9.80 and 4 sen respectively, gearing is 9.80/(0.04*8)=30.6 times. A movement of 1% of the underlying share will cause a movement of 30.6% for the 8 units of CR, an amplifying effect. In actual fact, at this moment, the delta (the change of option in relation to the underlying share according to a theoretical option pricing)is about 0.64. Hence the option has an effective leverage of 30.6%*0.64, or 20%, which means if Sime changes by 1%, the 8 units of CR should move by 20%. This delta changes closer to unity as CR rises in tandem with Sime. It is easier to look at some numbers. Say for example, for each ringgit of punting, if Sime goes up just 10% to 10.80, the average target price of all the analysts, CR punters will be settled off for a 306% gain at expiry if you buy CR at 4 sen now. Hence CR appeals to punters and gamblers, big payoff if the guess of the direction of Sime is right. However, there is no free lunch. If Sime goes down below 9.50, you lose everything.
I hope I haven't entice fundamentalist like Mat Cendana in the wrong path to become a punter rather than an investor.

Posted by beginner_1 > 2012-11-05 09:27 | Report Abuse

OTHERS Disposal of Sime-SIRIM Technologies Sdn Bhd (Announcement pursuant to Chapter 9.19(24) of Bursa Malaysia Securities Berhad Main Market Listing Requirements) - good news or bad news?

Posted by sixteenblue > 2012-11-08 15:58 | Report Abuse

"Flash: Musa Hitam retires as director and chairman of Sime Darby unexpectedly." - the edge on facebook
https://www.facebook.com/#!/pages/The-Edge-Malaysia/64839963085

Posted by sixteenblue > 2012-11-08 16:06 | Report Abuse

"Musa Hitam unexpectedly retires as Sime Darby chairman/director"
http://www.theedgemalaysia.com/business-news/224673-musa-hitam-unexpectedly-retires-as-sime-darby-chairmandirector-.html

Posted by Warrent > 2012-11-09 09:27 | Report Abuse

Hopefully we get a professional to lead sime darby which abide corporate governance and free from any political influence.

Posted by Warrent > 2012-11-09 09:42 | Report Abuse

Would propose Tan Sri Hassan Merican to become the next Chairman which I m confident that he will steer Sime Darby to a greater height and probably a new Global Champion like PETRONAS will be borne.

Posted by Mat Cendana > 2012-11-14 14:40 | Report Abuse

Sime is sliding. Wonder what's the problem? Is it something to do with the E&O suit?

Posted by passerby > 2012-11-14 14:40 | Report Abuse

i hope so :)

Posted by passerby > 2012-11-14 14:41 | Report Abuse

other plantation counters still ok

Posted by Mat Cendana > 2012-11-14 14:45 | Report Abuse

CPO price is up by RM35 to 2,359. The problem seems specific to Sime. If it's connected to E&O, maybe this is a good time to punt its CWs...? Maybe not because E&O isn't moving.

Posted by passerby > 2012-11-14 14:49 | Report Abuse

possible also, but I'm betting on the issue related to E&O :)

Posted by passerby > 2012-11-14 15:03 | Report Abuse

MC: Market making activity report by CIMB is out, they released 23.4 million units of Sime-CR around RM0.037 last month & only bought back 6.4 million units around RM0.04. CIMB is releasing huge volume last month

http://www.bursamalaysia.com/market/listed-companies/structured-warrants/1109241

Posted by Mat Cendana > 2012-11-14 15:07 | Report Abuse

Okay, thanks. I had gotten out of that one last week. Sold at the same price. But looking to get back in later if the situation is favourable. At the moment I'm just watching things.

Posted by izoklse > 2012-11-16 09:48 | Report Abuse

what happen to SIME ? Going down all the way.

Posted by passerby > 2012-11-27 14:05 | Report Abuse

results is out here :http://klse.i3investor.com/servlets/anpth/596345.jsp

Posted by daen > 2012-12-27 15:20 | Report Abuse

http://www.bloomberg.com/news/2012-12-27/palm-oil-advances-to-five-week-high-as-stockpiles-set-to-decline.html

Posted by izoklse > 2012-12-28 09:56 | Report Abuse

my wild guess is that they have to push the price to more then RM 10 before march 2013 and its already near to January a new palm oil tax structure will be release and it will for sure push up all palm oil related counter. They are EPF ma. They know what govt plan before everybody know it. Before people jump in and push the price up they go in first when it is so cheap. And yesterday and today with the help of oversea fund to close financial year with good record push up a lot of blue cip counter for this week.

Posted by bvc100x > 2013-02-28 08:05 | Report Abuse

huhuhu, yesterday news! -36% earning. fufufu, wait 4 GE come, so klse drop, sime drop too, buy!!!

Posted by Warrent > 2013-02-28 09:31 | Report Abuse

This counter is undervalue, if you are a long term player this counter is the one to keep.

Posted by Matsaham Mashuk > 2013-03-16 16:59 | Report Abuse

Drop lee lagi SIME..

Posted by Matsaham Mashuk > 2013-03-17 07:41 | Report Abuse

Fat Cat Tim Buddy jealous orang Melayu boleh berjaya dalam trading saham.hehehe

Posted by negro > 2013-03-26 16:17 | Report Abuse

See lah, you buy too much, HALT!!!

Posted by zack7 > 2013-05-31 13:16 | Report Abuse

Sime Darby Q3 earnings slump 21% to RM691m

Posted by L. C. Chong > 2013-08-31 22:53 | Report Abuse

SIME – Q4 2013 Financial Report (http://www.bursamalaysia.com/market/listed-companies/company-announcements/1393649) on 29 Aug 2013

Analysis Report – http://lcchong.wordpress.com/2013/08/31/simefundamental-analysis-31-aug-2013/ or http://lcchong.wordpress.com/knowledge-sharing/

Posted by davidjackson > 2013-10-29 15:49 |

Post removed.Why?

Posted by L. C. Chong > 2013-11-02 14:49 | Report Abuse

SIME Analysis – http://lcchong.wordpress.com/2013/11/02/simefundamental-analysis-2-nov-2013/

Posted by BroStockTrader > 2013-11-12 14:27 |

Post removed.Why?

Posted by sayandquoteit > 2013-11-15 09:13 | Report Abuse

good news await for SIME.

Posted by koyak71 > 2013-11-21 11:20 | Report Abuse

when sime qtr report will announce?

Posted by sayandquoteit > 2013-11-26 08:34 |

Post removed.Why?

Posted by ismailkarin > 2013-11-28 11:31 | Report Abuse

Sime Darby Motors boosted its presence in the Asia-Pacific region with its entry into Taiwan, following its appointment as the official, sole and exclusive assembler of Kia passenger vehicles in the country. - See more at: http://www.themalaymailonline.com/money/article/sime-darby-motors-makes-foray-into-taiwan-via-kia#sthash.UoeqG3KV.dpuf

Posted by talkrealreal > 2013-11-30 01:08 | Report Abuse

The world’s largest listed palm oil producer by acreage said net profit for its fiscal first quarter came in at RM516.2 million, down 50.3 per cent from the same quarter last year.

Posted by L. C. Chong > 2013-12-05 15:17 | Report Abuse

SIME Analysis – http://lcchong.wordpress.com/2013/12/05/simefundamental-analysis-5-dec-2013/

Posted by TanSriDato > 2013-12-15 01:29 | Report Abuse

Sime Darby Motor Group finally throw in the towel on Alfa Romeo dealership

Posted by koyak71 > 2013-12-19 12:03 | Report Abuse

why this counter not moving ? aiya

Posted by koyak71 > 2013-12-19 12:04 | Report Abuse

somebody block at 9.56

Posted by Airo Chasz > 2014-01-09 16:28 | Report Abuse

what happen?

Posted by LATO' > 2014-01-10 09:40 | Report Abuse

Now 52wks low !!

Will it go down further?

Posted by Airo Chasz > 2014-01-21 11:15 | Report Abuse

time for sime to rebound

Posted by TanSriDato > 2014-02-05 15:28 | Report Abuse

“Unlike Indonesian planters, selected Malaysian plantation stocks such as Genting Plantations, Sime Darby, KL Kepong and Sarawak Oil Palms have property development potential, given pockets of strategic estates held, it added in a separate note. — Bernama

Posted by Airo Chasz > 2014-02-06 11:05 | Report Abuse

grab sime-cw..good entry 0.025 below..accumulate n keep tight sure money

Posted by Mat Cendana > 2014-02-06 11:51 | Report Abuse

-CW Ex. 9.40; Expiry 30/5/14 ... Sime at 8.82 now.
For punters, there's a fighting chance here. But the problem is, Sime is on a downtrend since the start of 2014. Have to see it land on a solid floor first. 3.5 months to expiry isn't a long time. But I'm watching this one...

Posted by Airo Chasz > 2014-02-06 16:03 | Report Abuse

see,,,but wird coz all matched in 'mid' status in big vol..then it stop and put that 2k sell lot at 0.03cent..i sense this from banker,be careful

Posted by Mat Cendana > 2014-02-07 16:01 | Report Abuse

If it closes above 9.00 today, that would be notable. Psychology is very important - it's always difficult for any counter to break past any ".00" level. Stay too long below 9.00 and investors start to accept Sime as a "8 ringgit-something" counter. If it's above RM9 next week, -CW's 9.40 looks viable. A counter like this doesn't require too much to add 50-plus sen over a couple of weeks.

Posted by talkrealreal > 2014-02-07 16:09 | Report Abuse

this is a big blue chip. Don't need things like x.00 lah

Posted by Mat Cendana > 2014-02-07 16:16 | Report Abuse

Aiseh, -CW sellers asking for 0.03 now. Going to wait next week. If there's still interest in Sime, I'll consider forking out the extra half sen.

Posted by melovesony03 > 2014-02-10 20:30 | Report Abuse

Manage to sell some at rm0.035 but believe can fly higher..hehhe