CCAbbott888 wrote: PLITheOne wrote: I sure makes it difficult on what to do now. Should sell some at 5 cents, perhaps the highest value we will be able to recover , to buy Rights or hold hoping that the regulatory system will see through this and halt Monday to further investigate PLI’s direction.
PLITheOne I think that 5 cents is too low a price for you to sell now and use the proceeds to buy 1.5 cents for the purpose of averaging down. (i.e. for every share you sell at 5 cents, you can only acquire 3 shares at 1.5 cents). If you decide that you want to take part in the rights offer, it's better that it's new money. I'll illustrate in the two senario below.
Senario 1: say you currently own 10,000 shares at $1 and you sell max of 70% (7000 shares) at 5 cents to buy the rights at 1.5 cents.
70% is the max % because you may not have enough 'original' left for the rights (if the record date is set on a date after you selll your shares).
So 7000 shares at 5 cents=$350=23,000 shares at 1.152 ( I rounded up the number for simplicity)
So your final share count is 3000+23,000=26000 shares (which cost you $10,000 originally)
Your new average cost=
$0.38 per share (or a multiple of
25 times from 1.521 cents)
Senario 2: You don't sell your orignal holding, but put in $350
new money to buy the rights offering.
$350/0.01521=23000 new shares
Total share count after the refinancing/rights=33000 (10,000+23000), which cost you $10,350
Your new average cost=$
0.31 per share (or a multiple of
20 times from 1.521 cents)
Hope that this is clear, PLITheOne, I think that 5 cents is too low now to be helpful. You're better off put in a little bit new money to have a greater impact in lowering your average cost, imo. All the best.