Trading Experience with MAYBANK and AIRASIA

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Maybank LTD

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MAYBANK C24 11552

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Malayan Banking Berhad (MAYBANK) is known as one of the blue chip counter in KLCI. This company engaged in all aspect of commercial banking service and related financial services. For example they provide loan and finance product to their customers.

 

We choose Maybank to monitor because it is one of the leader in the finance industry. Hence it will lead the whole finance industry index and we found a finance tool which can leverage our profit with a little capital.

In 23/1/17, we had decided to buy in 800 unit of Maybank C24 on RM0.125 because of  the premium of the counter is not very high and its maturity date is 30/6/17 with a very high gearing which can help us to maximize our profit. So, we decided to start collect bellow the price RM0.13

 

we believe that the coming quarter report will bring out a flying color result due to the better performance of GDP growth in last quarter of 2016 and the dividend will be announce based on the history of the company. This will attract the hot money come in to the counter. However we decide to buy in the MAYBANK call warrant C24 because we decide to leverage our profit. Beside that the reason we choose to buy the call warrant is because the mother share is too expensive (RM 8.28 closed on 23/1/17).

 

To prevent we get a huge amount of loss, we also decided to set a cut loss point. We decide to set cut loss point on RM0.11, we measure the cut loss point using the technical indicator simple moving average 20 days, so once the counter last done price hit 0.11 we will sell off all of our call warrant 24 and record the realize loss.

AIRASIA 5099

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AIRASIA Berhad is engaged in the provision of air transportation service. It is the low-cost airline headquartered in Kuala Lumpur, Malaysia.

We choose to invest in AIRASIA is because the low cost airline in Asian is still having a huge potential market. According to the research of the World Bank ASEAN is the lowest flight per capita in the global region. In the North America there is 2.5 flight per capita, in the European Union there is an average of 1.3 flights per capita. However in ASEAN region there is only 0.3 flights per capita. Hence it had proved that the ASEAN had a very large market to let AIRASIA to expand.

 

Beside that, AIRASIA BERHAD is planning to sell of their subsidiary company which is AAC limited which offer USD 1 Billion by the third parties. If the company sell off the subsidiary company successfully, it will generate more cash and income for the company. Hence the company can reduce the debt and may able to release a huge amount of special dividend to the shareholders. We expect the company will release RM0.2-0.3 per share as dividend (according to our enter price RM2.25 it is 10% dividend).

 

We decide to buy 40 unit on 10 January with entry price RM2.25 is because based on the technical analysis the counter had appear the bullish engulfing signal, and the indicator MACD had cross over. Hence it prove that the downtrend of the counter is over. We also set a cut loss point which is RM 3 once the counter break RM3 we will cut loss directly.

 

Thank you for reading. I will post more articles related to investment analysis.

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