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Concordia Healthcare Corp. T.CXR.R



TSX:CXR.R - Post by User

Comment by argentia77on Sep 12, 2016 8:52pm
186 Views
Post# 25230207

RE:RE:If you believe Concordia share price will recover

RE:RE:If you believe Concordia share price will recover Colt:  Here's another way to look at the math. Suppose I'm long 5000 shares. I sell all my shares at today's closing price of $9.28 and receive 5000 x $9.28 = $46,400. I then buy 5000 call options that expire Apr 21, 2017 with a $10 strike for $1.95/share at a total cost of $9,750 (plus brokerage fees). That leaves me with $46,400 - $9,700 = $36,700 in cash + the 5000 call options. I can now give Concordia more than 6 months to complete its strategic review or whatever and come up with back- to-back positive quarters. I would be in the money if at any time its share price rises above 11.95 ($10 + $1.95) from now until April 21. If it doesn't and the sp continues to sink or stall under $11.95 I still have $36,700 in my account.          
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