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Bullboard - Stock Discussion Forum Volatus Aerospace Inc V.FLT

Alternate Symbol(s):  TAKOF

Volatus Aerospace Inc. is a consolidator and integrator of aerial intelligence and logistics solutions. It provides meaningful aerial solutions for end users across various industries using both piloted and remotely piloted aircraft systems. Its services include drone services quote, aerial surveillance, cargo solutions, confined space inspections, drone lidar inspections, drone inspection... see more

TSXV:FLT - Post Discussion

Volatus Aerospace Inc > Following Warrants up 28% today
View:
Post by InvestForce on Feb 10, 2021 8:39pm

Following Warrants up 28% today

This is a bit complicated but very interesting. Recall that DDC issued warrants and that is how they raise money. These are active now so I'll try to explain how this is potentially useful knowledge.

https://money.tmx.com/en/quote/FLT.WT.A

Background: A warrant is issued by the company (DDC --> Purchaser) and so differs from a stock option which comes from the open market pool of stock owners (Open Market --> Purchaser). So warrants give the holder the right to purchase a company's stock at a specific price and specific date and is used when a company doesn't issue options or wants to control share offerings. BOTH options and warrants have an expiration date.

The Observation: These warrants, with expiry dates, are being sold and were up 28% today, now valued at $1.60.

A Possible Interpretation: Obviously, the price of a warant has to be less than the stock price of FLT or else what's the advantage. Some could see this as a possible floor for FLT because it's a bet that the spread between the stock of the parent company (FLT) and the warrant is kept large enough. But, even warrants can fall so maybe that's not such a reliable marker. (Now buy/ask near $1.40 in my brokerage account after hours)

I'm not sure if there is any further depth or insight that can be gained from this and so I'll limit my thoughts and listen to anyone else that might have more to add that might know about the significance of the moves in the warrant market. My only point is that it could be a parallel indicator and possibly an predictor of the confidence in the price action of FLT.V, whether bullish or bearish. I don't know if I'm right but maybe it's of interest.
Comment by GreekTitan on Feb 10, 2021 8:55pm
How can warrants increase in value be bearish!? Warrants price is what you will pay for your stock... You can exercise your right to purchase the warrant prior to expiry... FLT.WT.A are 1.60$ (Current market price)+ 0.95$ Which makes your total cost per share 2.55$... which is above the value of the current share price... assuming the price opens at the bids you mentioned at 1.40$.... it is ...more  
Comment by InvestForce on Feb 10, 2021 9:06pm
Exactly, Greek. It would thus seem to be bullish and I was wondering if it could serve as a marker of a floor. Sorry, I didn't mean to insinuate bearishness. I guess it could go either way but I wondering if looking at that warrant market could any insight into the stock FLT action. What's your opinion on whether price action on one can be a leading indicator on the other and which one ...more  
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