RE:RE:RE:RE:RE:RE:RE:RE:RE:RE:Cash flowPositive q4?? The borrow is really expensive. It's harder to borrow a penny stock and the borrow is often based on USD$1.00/share so it really adds up regardless of the rate but that is also high in this case. It's a lot of stock to hedge too per $ of face and most arbs will hedge the new convertible bond too. The four month hold stock is obviously the most expensive but there is a chance that gets much better once the first bit of stock gets issued. But that's speculative.
Arbs don't take a fundamental view on securities so they will short regardless if FIRE revenues are up 100% next year or not.
johnale wrote: "The arb is the short borrow. That's why the opportunity exists. "
why is the spread so much? It's like 36.5% difference - with the debs trading at 31 vs fire at 20?
(All in 12.71vs20)
everything should be finalized before September 1 as per the release. there isn't a huge time lag here.
thanks