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Strategies & Market Trends : Three Amigos Stock Thread

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To: Ken W who wrote (258)	1/28/1998 2:05:00 AM
From: Cary C	Read Replies (2) of 29382

Here I was minding my own business and you had to bring up the slippers. Gosh that was a riot! I guess since Myron was over hear there was no chance of keeping it a secret for to long. Some people have asked about warrants. Specificly the PCTHW warrants. The following is my take on them. Anyone please feel free to add correct etc. Until this time when I bought the common first I have always purchased the warrants. In the last month the warrants had moved as fast if not faster than the common and it had become difficult to time themfor entry. I bought the warrants this morning because they didn't respond to the price movement of the stock this morning. Based on past trading experience only, I have traded the warrants three times. Every time the common went above 5 once 5 1/4 the warrants were at 2 or higher. If that scenario plays out again you would have a 3/8gain on 1 5/8 vs a 1/4 to 1/2 gain on 5 or 5 1/4. This would give you a 23% gain with the warrants vs 10.5% on the common. This is of course if the stock performs to past history which is what I'm banking on. It also allows you to buy more shares for the same amount of money. The warrants are good for another 3.5 years with a conversion price of 4.68. $4.68 + current price of warrants $1.625 = $ 6.305. If you own the warrants you are currently only out of even money of $1.55. When I have followed this stock in the past the warrants were almost always at least $2.00 +. This would mean that the warrants could conceivably go up another .45 to get to this point. The first time I bought the warrants they were at $2 and the common was at 4.25. The risk to the warrants of course is they can expire worthless where as the common can't. But that is over three years down the road and I believe the common will sometime before that be over $10. The company can call the warrants after 20 consecutive trading days over $9 something. That wouldn't break my heart because that would mean that the absolute minimum value of the warrants would be around $5 (5+ the conversion price). Hope some of this helps Cary

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