WARRANT VALUE I ran an option pricing model on the 1/2 warrant that will be issued with the $4.00 unit (1 share and 1/2 warrant exerciable at $5 for 2 years).
Now the main determinant of an option's value is its volatility, which for AMW is quite high (it has run from 20 cents to $5 or so, not in a straight line, in the last 6 months or so).
Based on various volatility assumptions, the 1/2 warrant included in the $4 unit is worth anywhere between 35 and 75 cents. This means the share being issued is "priced" at 3.25 to 3.65. We are currently trading at 3.77.
anyhow, the point is the 1/2 warrant has substantial value and thats why the share is/will trade below the $4 UNIT price for a short period of time till the warrant strippers have done their job/longs replacing current sahres with PP shares.
Nice news today. Any idea what that pod (where the drill results were published) weighs? maybe 10 million lbs.