RE:MGM - Common Shares vs. Warrants
Hi Chocky,
I have quite a bit of experience trading warrants on mining companies. I'm not sure of your knowledge level so I will try to educate you assuming your unfamiliar with trading warrants.
Most companies don't have tradeable warrants (MGM does and that's my play)
Usually investors get warrants when they take part in a private placement, but can't trade the warrants. They have to hold them until they're in the money and then spend cash to exercise them or if they never reach that point of being in the money they expire worthless.
MGM warrants don't expire until 2022 June 27, so almost two years.
I was able to buy them at $.025 a month or so ago. They are now trading at $.09. If I wished to, I could now sell them for a nice profit. That's not my strategy at this point.
The exercise price is $0.40 so if the common stock goes to $2.00 before the warrants expire the warrants will be worth a minimum of $1.60. If there's time left before expiration they will trade for a higher price. Assume they are trading for $1.60 at today's cost of $.09 your multiple is 17.78 times. If you buy the common shares at $.16 today and they sell for $2.00 in the future your multiple is 12.5 times, so a little less.
You have to make the decision if having an expiring asset is worth the risk for a potential higher gain.
Hope this helps.
BG3