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Gold/Mining/Energy : Gold and Silver Juniors, Mid-tiers and Producers -- Ignore unavailable to you. Want to Upgrade?

To: koan who wrote (8126)	3/17/2006 8:43:43 PM
From: koan	Respond to of 78412

What the hell caused the huge move in base metals today? Dollar??

To: koan who wrote (8126)	3/17/2006 10:25:11 PM
From: LLCF	Read Replies (1) \| Respond to of 78412

<Speculation can increase wts values.> Or not... hence your assertion that they are 'lagging' and should move 1:1 is actually an assertion that speculators will be here soon. :) DAK

To: koan who wrote (8126)	3/18/2006 12:38:11 AM
From: The Vet	Read Replies (1) \| Respond to of 78412

On the contrary, SLW.WT.B are already $1.33 in the money and have 1 to 1 leverage with over 4 years of time value. They should continue in line with the underlying stock 1 to 1 with a slight erosion of the time value from here on in. Based on standard Black-Scholes values I put the B warrant which closed at $5.50 at a fair value of about $7.17. The SLW.WT trading at $1.60 is closest to fair value of $1.72 and it is well in the money but with its 5 to 1 ratio it can only appreciate 20 cents for each dollar rise in Silver Wheaton stock. The A warrants have the same 5 to 1 ratio but with the higher strike price and slightly higher time value they should settle at around 12 cents a warrant less than the plain SLW.WT. As they are discounted more than that by the market they are better value closing at $1.32 with fair value around $1.60. The tendency is for warrants that are deep in the money to lose their time value much more rapidly than those near the money. Therefore we can expect SWL.WT to trade closer to actual conversion value as the price of SLW goes up.