Chris,
Thanks for posting the CIEN/TLAB news item. My CIEN/TLAB arbitrage narrowed from about 1 3/4 two days ago to about 1/2 today, obviously based upon the DOJ's hopscotch decision and the near-term closure of the deal. I was wondering during the ride home whether the same arbitrage play can be had with calls and naked calls, which would use much less equity. The problem is time premium.
CCSC/TLAB widened a bit today. I can't believe DOJ would object, but they certainly are nosing around enough to cause the spread to remain enormous. I'm a gambler, but not that much of a gambler, so I've avoided this arbitrage so far.
If anyone is interested, take a look at the CS thread for the NETVA/CS play. I took a position in that one a few days ago, and the spread remains at about 6 points (which ends up being less since 1 share of NETVA will become .6154 shares of CS).
Gary Korn
P.S. Don't forget that, at the end of the arbitrage play, your broker should be able to "flatten" your resultant long/short position without causing you to suffer the spread or pay any commission. |
