I first saw this ASDION-WB opportunity to arbitrage during beginning July.
http://networkingcapital.blogspot.com/2015/07/asdion-wb-short-term-arbitration.html
As you notice from my proof attached here, I bought in WB when it traded 0.68, then 0.585.
In average my ASDION-WB price is RM0.6325, mother was traded in range of 1.45-1.50 then.
With conversion ex-price RM0.50, my cost will be around RM1.1325. For me, I saw huge opportunity here! with a wide margin safety around RM0.36 then! which is high at around 30%. For me it is a risk worth taking then, as I was confirmed with execution on conversion to be around 2 weeks maximum turn around time. I have estimated then the worst of dropping might be at RM1.20 range only. With a drop of 20% in 2 weeks! I asked myself, with the current market condition where just recovering from selling down, now slowly recovering, will ASDION crashed? 20% in 2 weeks! For me, unlikely! My cost at RM1.1325 is a quite safe bet! I would load off once I successfully converted them!
I finally sold them of at market RM1.34 range, locking in my profit around 17% margin. Should the conversion completed before that day I sold, it will be easily above 20% margin! I pocket nearly RM700 easily just in 2 weeks time! Yes it is risky, But to me then, it is calculated risk which I can take!
If you asked me will I do again? YES! with wide margin of 30-40%, it is worth considering arbitraging also.
Finally, now ASDION CRASHED! it is not fair to judge me now based on condition now! I do not buy ASDION-WB because it is good company, I bought it because I saw opportunity there and I will react like monster, like a hedge fund to quickly kill and nail it!
I bet if ASDION today sustained at RM1.50, many will choose to keep quiet instead of praising me, lets be fair!
AFTER ALL, 17% PROFIT IN 2 WEEKS, not too BAD yeah in a down market as such.
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