Leong's Investment Strategy in Axiata Berhad
How many alternative investments does Leong have if he wants to invest in Axiata Berhad for no more than six months?
A. Buying the stock directly
B. Buying call options
If Leong has a two-year investment horizon, how many alternatives of investment does he have?
A. Buying the stock directly
B. Buying call options
Show how many alternative investments does Leong have if he wants to invest in Axiata Berhad for no more than six months?
A. Buying the stock directly
B. Buying call options
Answer:
Leong has two alternative investments available for a six-month investment horizon in Axiata Berhad: buying the stock directly or buying call options.
Answer:
Leong has two alternative investments available for a two-year investment horizon in Axiata Berhad: buying the stock directly or buying call options.
Answer:
Leong has two alternative investments available for a six-month investment horizon in Axiata Berhad: buying the stock directly or buying call options.
Leong is a successful businessman in Penang who is keen on building his own retirement plan through strategic investments. Currently, he has been eyeing the stock of Axiata Berhad, which he believes is about to make a significant move.
If Leong wants to invest in Axiata Berhad for no more than six months, he has two alternative investments to consider: buying the stock directly or buying call options. Each option comes with its own set of risks and potential returns. By analyzing the potential outcomes of each investment, Leong can make an informed decision that aligns with his investment goals.
With a two-year investment horizon, Leong still has the same two alternative investments available: buying the stock directly or buying call options. The extended investment horizon allows Leong to explore different strategies and evaluate the performance of Axiata Berhad over a longer period.
Considering the potential growth of Axiata Berhad's stock to RM50 over a six-month holding period, Leong needs to calculate the holding period return for each investment alternative. By comparing the holding period returns for buying the stock directly and buying call options, Leong can determine the course of action that maximizes his profit.
It is important for Leong to also consider other factors such as comparative risk exposure before making his final decision. While buying call options can offer leverage and potentially higher returns, it also comes with higher risk compared to buying the stock directly. Leong should assess his risk tolerance, market volatility, and his confidence in predicting the stock's performance to mitigate potential risks.
By combining a thorough analysis of return and risk factors, Leong can develop a well-rounded investment strategy for Axiata Berhad that aligns with his financial goals and risk appetite.