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Technology Stocks : Ascend Communications (ASND) -- Ignore unavailable to you. Want to Upgrade?

To: Kenneth E. Phillipps who wrote (59077)	1/13/1999 4:58:00 PM
From: thebeach	Read Replies (1) \| Respond to of 61433

Does anyone know how many shorts were covered today?

To: Kenneth E. Phillipps who wrote (59077)	1/13/1999 6:48:00 PM
From: Dee Jay	Respond to of 61433

as thebeach said, the being purchased company's stock never sells at the exchange ratio because there's always a risk the deal will fall apart. The premium or differential is what the arbs use to their profit by assuming that risk - they short the buyer's stock and puchase the acquiree's stock with the proceeds. As the consummation date draws closer the gap in price shrinks until it's very close to or at the exchange ratio. The excess gap is always because of risk factors... Dee Jay