Plantation Sector: Trading In A Seasonally Strong 4Q

Over the past 52 weeks, the Bursa Malaysia Plantation index (KLPLN) has been trading within a lowto-high range of around 10%. Meanwhile, the index's 30-day price volatility has decreased to levels near the lowest since 2008. However, as we complete the first half of the fourth quarter, there is a silver lining for the sector. The correlation between the index and the benchmark FCPO has remained strong in the past 52 weeks, and if historical seasonality unfolds as it statistically tends to this year, the plantation sector index may, at the minimum, find a short-term respite and create a window for trading.