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How to master stock option[warrant] with just this video without knowing what is ⍺, Ω, ℽ - YouTube
Channel: unknown
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- How to master stock option
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or warrant,
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especially in Malaysia
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with just this video.
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Without knowing what is Alpha,
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what is omega, what is gamma.
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Right, now my name is Guan Hor here.
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Now in this video I want to share with you
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how we can master Stock warrant.
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Now with this one item.
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Now, this item is what we
call a discount voucher.
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Now, with this discount
voucher I can go to
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that restaurant.
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Order this set lunch,
Teriyaki Beef Teppan,
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and I will just need to pay 15 ringgit
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as per the discount voucher stated here.
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Right.
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Now, this is basically
the very same concept
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of a stock warrant.
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Now, this very thing is
actually called a lunch warrant
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but the stock warrant that we are trading
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that has
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the very same thing as this voucher.
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Now, the first thing is
that, the particular item,
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the underlying item.
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Now for a stock warrant,
the underlying item
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is a specific share.
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Let's say there is a Maxis share,
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there is a Maxis warrant
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Let's say there is a Mah Sing share.
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That particular thing
is a Mah Sing warrant.
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Okay, now for this instance
is actually a Teriyaki
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Beef Teppan warrant.
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Okay, and the second thing
that is very same as a warrant
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is that this discounted price 15 ringgit.
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Now, it can be any number,
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like 10 ringgit
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or maybe 30 ringgit, right.
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This thing is what in stock warrant
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they call it Exercise price
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they call it Exercise price
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but in this module, we just say that this
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is a discounted price.
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This thing is the same as a stock warrant
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which it has an expiry date,
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now for this case it is
the 31st October 2019.
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Basically it means, if I
go to this same restaurant,
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order the same thing,
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I can't get this discounted price
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after this expiry date.
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Basically the same as a stock warrant
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because when a stock warrant expires
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you can't use it to exercise it
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and buy a particular share
at a discounted price.
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Same as this, the waiter
will tell you that,
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"Sorry sir, this voucher
has already expired"
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Okay.
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Now, another thing I want to point out is
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point number two here.
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Let me show you clearly.
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Okay.
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Point number 2 here, it says limited to
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one voucher redemption per person.
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Now this concept is the very same
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as a stock warrant ratio.
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Which means you need to have,
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how much of this, how many piece of this
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discount voucher to basically get this
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lunch set at a discount price.
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Now, it says this,
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for this instance it
says it needs one voucher
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but in stock warrant,
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it could say
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maybe I need 2 vouchers, 2 warrants
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to get the specific share
at a 15 ringgit price.
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Let's say that is a 15
ringgit exercise price.
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So, basically this is a 4 main thing
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that is the very same as
this discount voucher.
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Right.
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Then let's say there is
a share called a Stock A,
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listed in Malaysia and it has warrant.
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The warrant also actually the same set.
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It has a discounted price of 15 ringgit.
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Let's say this is stock A.
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Okay.
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Let's say stock A is
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currently priced at 20 ringgit per share.
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Which means that
particular warrant is worth
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5 ringgit.
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Why?
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Because 20 ringgit
minus the exercise price
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is 15 ringgit.
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Which means you can get that share with
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a 5 ringgit saving.
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So, basically this warrant worth 5 ringgit
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at that time.
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Now, let's say the very same share
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the price really dropped to ten ringgit.
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Basically which means you
can get that share with
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10 ringgit only.
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Then this warrant will be worthless.
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Why?
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You can pay 10 ringgit you
that for the very same share.
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Why you want to pay 15 ringgit
for the same thing right.
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So, basically if that's the case,
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then this is what they call
a out-of-the-money warrant.
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Okay.
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Now, with this item, now with this video.
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I hope you kind of get the idea of
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how we can value a stock option.
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How we can master a stock warrant.
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Thank you for watching.
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