Post by
TeamCommonSense on Oct 06, 2024 8:55pm
More observations pertaining to the spinoff
I had anticipated extreme volatility during the 25 Sept to 01 Oct period, inclusive .... regarding the variants on offer on the TSX .... specifically:
TRP trading with the rights to the spinoff SOBO shares,
TRP.W trading ... in advance if you will ... as the "new" post spinoff entity, and
SOBO trading on an "if, as and when" basis in advance of the 02 Oct launch
So ... like a hyena scanning for a weak wildebeest in the herd ... I earmarked about $200k and waited and watched and waited and watched for any weakness in the 3 prices. As far as TRP and TRP.W, there was no discernible weakness ... not too surprising I guess cuz of their "greener" credentials post spinoff. For SOBO, on opening day ... it fell briefly to a low of $27.90. I got 1,000 at $27.99 and $1,000 at $28.00 .... BUT ..... I lacked the conviction to go "whole hog" and sink the whole amount into SOBO that day. As I watched in subsequent days, I managed to get 600 at $29.01 and 1,000 at $29.06.
Moral of the story ... "he who hesitates is lost!".
Now I'm still watching with about $75k of dry powder but I doubt the volatility will take it that low again. Not unless Dustbin Turdo and his sidekick Geebow and/or The Prophet Gretta Thunberg start throwing expletives and invectives at SOBO cuz it is exclusively in the "dirty oil" business. Could I actually find myself in a position to cheer for Dustbin? Say it ain't so!
There are a couple other issues re SOBO that I cannot wrap my head around ... TRP has approx. 1 Billion shares out ... so I estimated that at a spinoff of 0.2 to 1, SOBO should have about 200 million shares out. So given that almost 2.3 Million SOBO shares traded during the 25 Sept. to 01 Oct. period before the new entity was legally spunoff ... where exactly did those shares (some of which you and I bought) come from? And on the first day of trading post spinoff (02 Oct.), 19.5 Million SOBO shares traded ... meaning approx. 10% of the total. That is a very, very high turnover of a stock in one day. Anybody else have difficulty understanding these two aspects ... or is it just this old timer (being me)?
Cheers!