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Enterprising Investor

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Alias Born 04/05/2009

Enterprising Investor

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Re: fali post# 345

Wednesday, 09/01/2010 9:01:42 AM

Wednesday, September 01, 2010 9:01:42 AM

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Traders may be able to make a buck.

Long-term investors need to wait.

The good news may generate some volatility in market prices. Once the rights offering begins, I expect prices to start a decline.

Why?

Each shareholder will receive 15.335 rights to buy shares at $.20. Based on yesterday's close of $.835 per share, this equals a $.635 difference. This is a huge!

Traditionally, arbs sell shares short, exercise rights, deliver shares and take home a risk-free profit.

If you aren't an Enterprising Investor, become one—you'll love making money like Benjamin Graham.

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