Dubai
Arabtec rights traders are staring at losses after falling into the trap on the first day.
Most of the traders bought into rights on the first day, when circuit filters were not in place in anticipation of pocketing a part of 2,000 per cent rise in the price.
But from the second trading session, traders of Arabtec rights were stuck with positions because circuit filters came into effect.
Arabtec rights have been witnessing lower circuit since day 2. On Thursday, Arabtec rights fell another 10 per cent to Dh0.066.
“This was a kind of massive speculation. It was a kind of call option. Since the lower circuit is in place, it would become difficult for traders to come out. The best option for traders would be to book losses, and come out,” said an analyst with a brokerage did not who wish to be named.
Traders will have an option to buy the rights at Dh1, but practically no one would prefer going for such an option, when the stock price is lower than the offer price, the analyst added.
May 28 is the last day for subscription, and trading in rights would cease from May 21 or Sunday.
