CMTR-CHEMTRAK FDA OK Message Board

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Biotech / Medical : CMTR-CHEMTRAK FDA OK

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To: Rocketman who wrote (557)	3/30/1997 1:47:00 PM
From: Art Baer	of 1172

I have said this before, but i will reiterate it. One of the reasons for the large short interest is the converted debts. Heres the way it works. The investors who bought the convertable debts from the company. (5 million worth). recieved a discount off the stock price when the convert. Lets say an investor converts 1 million dollars of convertabvle notes on a $2 stock. They normally would recieve 500,000 shares. Howver, they get them at a discount. i posted in an earlier post what that number is. I can't recall now, but i believe it is in the range of 10-15%. So the investor gets about 571,428 shares. If he then goes and shorts the stock he has locked in this gain of 10-15%. I think some investors might be using this method as I think it is common when there is a bigger risk than blue-chip stocks. However, I have no clue what this means to us. Art

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