RE:RE:RE:RE:RE:warrants You are correct I don't understand where you are coming from.
A covered strategy means you are not truly short because you own the underlying security.
You can never be squeezed because you are hedged. Since I will always get 0.35/share when exercised I could care less what the stock is trading for if I were exercised because I would just assign my shares that I bought when I sold the warrant.
To the other concern about shorting any TLT instrument this strategy requires a share to be bought against a warrant that is sold short. If anything it would support a higher share price - the warrants trade on their own supply and demand fundamentals as we have seen since they first started to trade. "I don't know what you mean by bought in" and if there were a takeover I could see the warrants exercised early to give the owner voting rights.
menoalittle wrote: actually, I understand perfectly what you said. Rather, it appears that it is you that doesn't understand. Have you ever played the short side of any equity? Perhaps not, else you might have a clue as to the possibility of being bought in (whether you like it or not), regardless of whether or not the warrant is exercised.
And by the way, no one in their right mind is going to exercies any of these warrants much ahead of their maturity date.