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BW's used to be seasonal
Traditionally, there were 2 seasons for Blockbuster Warrants: Holiday, starting around Thanksgiving, and Summer, starting around Memorial Day. Strike prices would be set all at the same time, but IPO's for the individual BW's varied. One big problem with this was that strike prices were set well before movies were released, so in every season, there were inevitably strike prices set that were either ridiculously low or way too high. A movie starring HFORD that was expected to be a big hit might be trading at H$200 around the time when strike prices were set in November. But if that movie bombs in January, then it becomes obvious very quickly that it won't make the strike price for the BW, so shorting the BW is easy money. OTOH, if a movie is an unexpected hit, then everyone makes easy money going long.
Also, the delist date was the same for all BW's for that season. So the BW for a movie released in November would have the same delist date (usually early February) as a movie release in late December. This made it difficult to compare the performance of BW's. With a standard 12-week delist date, it's easier to compare how different movies performed.
Much as I like easy money, I much prefer this system. BW values are much more realistic, and therefore, ideally, more challenging to play. It also means that we don't waste time with meaningless BW's. You will notice, for example, that there not BW's for OMARS or BTSHP.
thanks for the summary {nm} Jun 01, 08:26
i'm confused and new ... Jun 03, 15:14
BW's used to be seasonal Jun 03, 19:01