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| Good Reason to Celebrate |
However, lack of cash made me dispose of all my holdings as well as my rights offers.
Let us compute what a shareholder with 10 lots of BJ Food stand to gain from the entire exercise of hardly a month.
Assuming you bought the 10 lots at RM1.20. This means you have coughed out about RM12,040.
The rights you would be offered will be on a 4 for 5 basis. That means they will offer you 8 lots of the new rights with an equivalent number of warrants.
You need to pony up RM6,515 for the rights. that includes RM10 revenue stamp as well as about RM5 for your bank draft.
Assumed you sold all your 10 lots of mother shares at 95 sen after it ex-rights offer. That will bring you returns of RM9,450. You therefore take outright loss of RM 2,590.
Now to the new trading scenario.
BJFoods has now gone ex- and has touched a high of RM1.24. The warrants was well traded until 60sen.
Assuming you have sold all your BJFoods new rights at RM1.20; then you would have taken in RM9,600 gross. Let's assume you have also relinquish the warrants at 60 sen each. This will add to RM4,800. Total takings will be RM14,400. After deducting for RM 6,515 for the rights issue and a loss of RM 2,590, you would have a clean profit of RM5,295.
Imagine a return of 81% all within a month!
Great stock, don't you think so?
Pity I can only calculate my loss.
Next to watch will be YTL Power Warrants.
I do hope my investment and trading strategy will be okay this time around.
As they all say, you have Vision 20 20 mostly on hindsight!
