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Thursday, January 10, 2008

Warrant selection rules

My warrant selection rules:
0. The underlying stock must give some (or already given) bullish signals.
1. More than 2 months of lifetime (I cannot handle the pressure if it is too short).
2. Must be in the money or almost in the money (better chance that it does not become expensive toilet paper).
3. The lower the premium, the better (of course, what a silly statement!).

Due to the warrant's limited lifetime, I will never buy a warrant (or bottom fish) and wait for the underlying stock to turn bullish. The risk is not worth it.

My choices (in decreasing preference):
- IOICorp: CE, CG, CF
- KLK: CE, CF
- Bursa: CF, CI, CH
- Maybank: CF, CG, CE
- PBBank: CD, CF, CE
- Resorts: CE, CD
- YTL: CE, CF

1 comment:

Sowan said...

What is your comment on Jotech? Is it true that their stock including warrant will shoot up shortly? This company will make announcement on their expansion plans in Indonesia, China and Vietnam soon. Will it affect their stock prices?