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Strategies & Market Trends : Arbitrage Plays -- Ignore unavailable to you. Want to Upgrade?

To: Keith J who wrote (296)	3/17/2001 1:28:17 AM
From: MechanicalMethod	Read Replies (1) \| Respond to of 376

Keith, Can you describe the way a 'hedge' works using RPS and SUNW as an example. It sounds interesting. TIA -- Mechanical Method

To: Keith J who wrote (296)	3/17/2001 6:01:37 PM
From: Mark Davis	Read Replies (1) \| Respond to of 376

I'd comment on these Perqs if I could make sense of the fine print. These are the antithesis of the KISS principle. Acceleration Event If on any date the product of the Market Price per share of Sun Microsystems Stock and the Exchange Factor is less than $4.00, the maturity date of the Reset PERQS will be deemed to be accelerated to such date, and we will apply each $6.51875 principal amount of each Reset PERQS as payment for a number of shares of Sun Microsystems Stock at the then current Exchange Ratio, as adjusted by the then current Exchange Factor. See also "Antidilution Adjustments" below. Is this relevant? Also , how did you come up with the 339 shares of RPS which seems to imply a profit of $446 per hedge as of Fridays closing price.