Here's an opportunity for the speculative portion of your pf.
Red Eagle Mining aka R.TO recently opened a new gold mine in Colombia and promptly ran into difficulties. They had to shut down and refinance using a fully subscribed rights offering so they can modify the way they are mining and give it another shot.
Alas, much of my knowledge of Red Eagle is based on proprietary sources I can not share, but I am confident that with the modifications they are making that they can make a go of it.
But I am not talking about the common shares, though they may well turn out to be a good buy, and a safer investment than what I have bought into, the warrants connected to the rights offering.
Red Eagle Mining warrants to trade on TSX Sept. 5
2017-08-31 14:38 ET - Warrants Called to Trade
The Toronto Stock Exchange reports that Red Eagle Mining Corp.'s warrants will begin trading on the TSX at the open on Sept. 5, 2017. According to the TSX, there will be 85,629,689 warrants outstanding, trading under the symbol R.WT and Cusip No. 756566 13 9.
The TSX reports that the listing covers warrants forming part of the 85,629,689 units issued at 35 cents, pursuant to the company's recently completed rights offering. As described in the rights offering circular dated June 26, 2017, each unit consisted of one share and one warrant, and the units separated immediately upon the closing of the offering. The warrants are exercisable at 50 cents per share until 4 p.m. Toronto time on Aug. 7, 2022.
For more information, see the TSX bulletin dated June 28, 2017.
I have paid just under 10 cents for my warrants, and am very confident that at some point over the next five years that the common shares will trade over 60 cents, which is where I start making money, though I expect that anytime the common shares approach the strike price, 50 cents, the warrants will head much higher than 10 cents unless there is very little time left before they expire.
Normally I caution people who are unfamiliar with trading warrants that they will need to be very patient in buying and selling due to low volume, but with over 85 million warrants out liquidity should not be an issue. That said, it is always a good idea to have a stink bid sitting there for warrants you are interested in because, more so than with the common stock, sometimes you get amazingly cheap prices because someone has decided to dump at any price.
LC
