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Question with regard to Blockbuster Warrants
Question with regard to Blockbuster Warrants. According to info I have read on the site a BW has a strike price say $H120. If I own a warrant and hold it til expiration which is the 12 week of distribution the BW pays out the difference between the gross after 12 weeks and it's strike price so lets say the film in question grosses $130 Million so the BW would pay out $H10 which is the difference right? So what I am wondering is I am holding a warrant on a film that has grossed $211 after 10 weeks. The strike price is $165 so this warrant as currently stands is worth no less than $H46 because that is the difference between the strike and the goss right? Am i missing something?
Question with regard to Blockbuster Warrants Aug 14, 10:30
You seem to have it correctly. At the time of IPO, 165 seemed a reasonable strike. Since the movie has had good legs, Aug 14, 10:54
math formula for you Aug 14, 11:08
OK I get it now Aug 14, 11:31
yup...so ARB happens a lot with BWs {nm} Aug 14, 12:04
Yes, many of the people who trade derivatives might already be maxed out since IPO... {nm} Aug 14, 12:06
ARB? What's it astand for? {nm} Aug 14, 12:23
Arbitrage - a real stock term that is used with a slightly different definition here at HSX {nm} Aug 14, 12:28
Article with answer to your question (link inside) Aug 14, 12:28
wow... wrote a post for you but you didnt read it... cause it talked about ARB... guess you dont want help {nm} Aug 14, 13:06
opps... hey... where did my second post go? {nm} Aug 14, 13:07
Got eaten by an Arby's customer. :P {nm} Aug 14, 22:16
Thanks for the input everyone Aug 16, 10:12