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Gold/Mining/Energy : Arcon Energy (MIDL Presently) The Ultimate Sleeper -- Ignore unavailable to you. Want to Upgrade?

To: Dusty who wrote (2318)6/2/1998 2:12:00 PM
From: spy hard  Read Replies (1) | Respond to of 4142
 
Dusty,

I'm might be wrong but here is my theory.

If common is trading under $.50 you are probably right and warrants do not make any difference. However, in all other instances warrants are the key.

It sounds simple to me, but maybe I missing something.

The price of the stock go up and the warrant do not follow. In that scenerio PEOPLE(whoever they are) buy the warrants and sell the common, kepping the price of the common down. If the price of the common goes down so is the price of the prefferred, since it is directly correlated to each other.

If the price of the warrant follows we have no problem.

To prove my point look at the trading for the last week or since May 18. In the morning or at the open the price of the common fly up and since warrants do not follow it goes right back down.

Do not take me wrong I think P's are a great play, but I have a feeling that most of us do not have unlimited amount of money to play with, so people have been selling common and W's to buy P's.

In my opinion we are cutting the same branch we are sitting on.

Of course I might be completely off base.

Best Regards



To: Dusty who wrote (2318)6/2/1998 2:16:00 PM
From: one_less  Respond to of 4142
 
Nope, I have the worst case scenario. This dribble about P=2/3 and P=35 times the common will continue to discourage any new investors from considering joining us.

Or, common sense and best case scenario could take over and create renewed interest. Jeff's post #2314 is a good example.

If you want to continue this exhausting and fruitless discussion on what the P's are worth, maybe a new thread could be created just for that.


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