ASHTON MINING OF CANADA (ACA) Message Board

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Gold/Mining/Energy : ASHTON MINING OF CANADA (ACA)

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To: Chris who wrote (1992)	9/7/1997 12:45:00 PM
From: Jim P	of 7966

Hi Chris The rights do not really have an effect on the stock value. Rather it is the stock value that has an effect on the value of the rights. The rights currently are trading at a price wich inclueds Time Value. Asume the value of ACA shares are currently $4.00. Forget about commision for this example. The value of one right is .25. People buying the rights today are hoping the value of one ACA share on the expiry date of the rights will be in excess of $4.00.(4 X .25 + $3.00 = $4.00). In addition to the .25 you can expect to pay Time Value as such if ACA shares were $4.00 you probably will end up paying more then .25 for each right. Those buying the rights today say at .25 are hoping the value of one ACA share by the rights expiry will be say $5.00. Therefore spending .25 X 4 + $3.00 = $ 4.00 and profiting $1.00 per share.Of course should the value of an ACA share reach $5.00 the rights would probably trade at .50+ Time Value, with the time value reducing as the expiry date of the rights approaches. Which way this stock will go in the next couple of weeks is any bodies guess. Tough decision.

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