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Politics : Formerly About Advanced Micro Devices -- Ignore unavailable to you. Want to Upgrade?

To: Richard P. who wrote (281708)	3/24/2006 11:24:45 PM
From: AK2004	Read Replies (1) \| Respond to of 1571616

Richard I do not know much about it but let see: arbitrage if you short one side and long another with credit. 9.62 (LEXR) should be equivalent to .5625 * 14.47 (MU) = 8.4 so I guess the idea is that you short lexr and buy mu. Is that an arbitrage? I do not think so. The discrepancy is probably due to the fact that the deal is not finalized. If you can tolerate the risk you can probably get some decent return but keep in mind that bidding war may start even after all papers are signed. In that scenario you would be holding a naked short mu position. If you would try to hedge the risks then it is likely to eat all your gains and plus. Keep in mind that I am no expert in arbitrage trading so I may be way off.... -AK