TOPABK

[boing]

Regarding this warrant. When I look at the Standard Bank info on my watchlist the bid price is 67c and the offer price is 69c. On the ABSA matrix however, the bid price is 63c and the offer is 65c. If I want to buy this warrant right now at the offer price, will I have to pay 65c or 69c?

[#2]

According to the lastest matrix TOPABK is bid 65c and sell 67c for TOPI @ 23077

[Tango]

Where are you getting your index prices? Index warrant prices are based on futures, not cash

[boing]

Thank you for the reply SI and Tango. Super; I looked at the bid and offer price on the matrix that was highlighted this morning. I presume that was wrong and one must look at the TOPI at that point in time and the corresponding bid and offer price( in this case 23077). Tango; I am sorry, I am not with you at all. Can you please tell me how I must determine the price at which I can buy an index warrant at any given time. Thanx

[Tango]

If you look at the 'Key Market Statistics' on this site you will see the current index cash value. This is not what the market-makers price their spread on. You need to look at a near-dated futures prices. Best to simply call the issuer if you want to check the prices.

[#6]

You sure of that Tango? The warrant matrix pricing matches the live (cash) price action of TOPI from price streamer, precisely.

[Tango]

no, not sure about it on warrants. Apparently that's how wave pricing works. I assumed warrant issuers did the same. Anyone with more knowledge please chip in

[SimonPB]

tango is correct. All Top40 warrants are priced off the near dated ALSI futures contract as that's were the issuer hedges the position.

[#9]

Thanks Simon, that prospect did cross my mind. But how would one check the action on TOPI futures?

[boing]

If I do call the issuer to check the prices, can I then also buy from the issuer at the offer price? In other words, do the buyers and sellers make the market for the price of the warrant or does the issuer make the market? Apologies for all the questions but I would rather become knowledgable than accusing the issuers of being crooks later on.

[#11]

The issuer makes the market as per the matrix, normally 100,000 shares on offer either way. Any other bids or offers you see are other traders.

[SimonPB]

15 minute delayed futures at;
http://www.hisat.co.za/newhisat/live_safex_financial_prices.asp

[#13]

Ja Simon - hopefully SFM are gonna do something about that - dont know how one can get the timing right with delayed prices on a totally seperate site...

[#14]

WAVes and ABSA Turbos eg TOPATP/A are priced on the ALSI Future.They have no time decay. All other Index warrants based on Top 40 Index.Im not sure if any other instruments besides these 2 types have been issued, but as far as I know, theyre the only ones based on the ALSI Future.

[#15]

My apologies. I was blissfully unaware of that. Simon should know.