SI
SI
discoversearch

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor.  We ask that you disable ad blocking while on Silicon Investor in the best interests of our community.  If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.
Technology Stocks : Ascend Communications (ASND)
ASND 202.23-4.2%Dec 2 3:59 PM EST
 Public ReplyPrvt ReplyMark as Last ReadFilePrevious 10Next 10PreviousNext  
To: Jan Crawley who wrote (51458)8/3/1998 5:25:00 PM
From: Sanzen  Read Replies (2) of 61433
 
Jan,

You arbitrage posting looks right to me. However, if you have
to borrow money to buy stratus, then it doesn't seem
to make sense. Here was my calculation this morning:

Short 4000 ASND (agaist box in my case): $180000(4000*45) goes in
short account and doesn't earn interest. Buy 5334 (4000/0.75) shares
SRA and you need roughly $175,000. If I borrow that on margin,
the interest would eat $4046(175000*0.0925/12*3, that is, assuming
a margin rate of 9.25% and the merge takes 3 months to consummate),
which almost equals to the arbitrage gain.

Am I right? Comments anyone?
Report TOU ViolationShare This Post
 Public ReplyPrvt ReplyMark as Last ReadFilePrevious 10Next 10PreviousNext  

HomeMailHotSubjectMarksPeopleMarksKeepersSettings
Terms Of UseContact UsCopyright/IP PolicyPrivacy PolicyAbout UsFAQAdvertise on SI
© 2025 Knight Sac Media.  Data provided by Twelve Data, Alpha Vantage, and CityFALCON News