Often a rights offering can be traded in the same way you would trade a warrant expiration. As long as the rights are publicly traded, arbitrage between the common and the rights will result in downward pressure on the common stock. While there is usually little profit for the average investor in the arbitrage, you […]
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We’ve been following the Ford warrant expiration here in very great detail. We described how the stock would likely trade leading up to the final day of trading for the warrants, what the expiration would mean (including a comparison with the recent GM buyback), and what the stock would likely do (move up, haha) as […]
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The “fiscal cliff” is providing an opportunity in F as it pulls back into the $11.50 range. Today and Monday are the final days for the warrant to trade, and playing a post warrant expiration bounce means getting into the stock today and / or Monday. Obviously it’s better to buy on the price decline, […]
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Yesterday, Dec. 19th, General Motors (GM) announced it would purchase from the U.S. government 200 million shares of common stock at $27.50 a share. The previous day the stock had closed at $25.49 and on this news the stock opened at $27.44, traded as high as $27.90, and then settled back in to close at […]
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We recently received a question about warrants and short stock positions. One of the strategies that can be used profitably with warrants is to buy warrants and short common stock. This results in a short position in the common in your brokerage account. The question is can your long warrants now be used to “close […]
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