HOLLYWOOD STOCK EXCHANGE
THE ENTERTAINMENT MARKET
THE ENTERTAINMENT MARKET
It is a security that cashes out (delists) at the actual amount of the opening weekend box office of a wide release movie with no multipier.
These derivatives generally IPO on the Wednesday prior to the opening of the movie, and IPO at the same amount as the stike price as the Put and Call options. (IE if MOVIE.PU and MOVIE.CA have a strike of 25, then MOVIE.OW will IPO at 25.00)
The derivative will rise and fall in value based upon market factors and will halt on the day of wide release.
In the case of our ficticious MOVIE.OW, if the formula is weekend box x 2.7, then 25 projects to an adjust of 67.50 If MOVIE rises above that, MOVIE.OW will rise. If MOVIE falls, then MOVIE.OW will tend to fall.
At the time of the halt, if you are holding the security, you hope you are holding long or short based upon how the movie will perform versus the final value of the security, not the opening price.
In the case of MOVIE.OW, if it is worth 33 at the time of the halt, holding it long means that you expect that MOVIE will adjust to more than 89.10 (30*2.7) and holding it short means that you think it will adjust to less than 90.10
Note: These securities do not include the "Previous Box" for movies that open prior to Friday (ie TREK2), but do include Monday for 4-day Holidays (ie Mem Day), and are marked Thur-Sun for Thanksgiving.
Want To Ask. What is a OW aka Opening Weekend option? {nm} Jun 23, 04:08
It is a security that cashes out (delists) at the actual amount of the opening weekend box office of a wide release movie with no multipier. Jun 23, 06:31
Typo..... 89.10= 33 * 2.7 {nm} Jun 23, 06:33
They IPO nine days before the movie releases, not the two implied by "Wednesday prior to the opening of the movie" Jun 23, 10:41
I'm pretty sure it's always a Wednesday(see HNOV3). It's the Wed of the week before the opening week. {nm} Jun 23, 15:01
Yes, always a Wed. Was trying to say "Wed of week before release" rather than "the Wed before release" Jun 24, 09:51
i had to think a bit before I figured out how to say it. And even then I had to look at it twice, three times. :) {nm} Jun 24, 15:00
Cash-out Jun 25, 01:11
An explanation and details about OWs are printed on each OW page. {nm} Jun 23, 06:49
