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Only if you don’t like making money
$ABML hod on nice news this morning.
$CRTD, hit almost 40c today. A few runners finally, ABML was a good one this morning also... OTC getting some life back.
LTMAQ hit 40c
Oct 14, all stock 1c-$1 over 1M volume up 10%
Symbol %Change Last Volume
CRTD +69.57% 0.195 3648075
FNHC +48.02% 0.52 42323982
DVLP +35.87% 0.0125 102899330
LTMAQ +27.45% 0.13 1602910
MRKR +25.81% 0.39 1259096
SBFM +23.47% 0.805 3842620
CNXA +17.01% 0.2703 6787327
NXMR +16.77% 0.0188 4962307
CGRA +15.86% 0.0168 1322669
ENZC +14.49% 0.049 15851616
ZVO +12.66% 0.1629 23812332
CIDM +12.43% 0.5046 2492194
SYTA +11.60% 0.1674 14650418
There are brokers other than TDA where you do not need to pay fees. Firstrade and fidelity have no OTC fees. But no, not 1k orders. If they volume is 300k, then 30k order would suffice. Any more than that and you are hitting over the 10% threshold anyway. Adjust the order to the volume.
Again CRTD today, 10c to 23 today
Whoever is posted 300k ask sizes when the volume is 90k might have some issues.
1) You should not sell more than 10% of the volume or you broker might contact you for illegal price manipulation (especially if the price is going up like today at you start posting big fake orders). I once hit that myself day trading otc and had to explain it to my broker. Now I watch my volume to overall volume very closely. That is why you see these t-trades in OTC for around 10% of volume, when they sell they try to keep it around that to not set off any flags. ...
2) Spamming 300k orders for a few seconds to cancel them is considered illegal price manipulation, which the SEC has went after before.
3) If you are trying to sell 300k, break you order sizes up to match the volume and not push down the price.
....just a word of advice.
$HMBL, there was the move finally double today
Next month they have a 400k cash based option. At say 25c 10 day vwap, the exercise price will be 17c. So I am guessing that would give them 5M options at 17c exercise. To exercise the options (I am not sure if it is required they exercise immediately from the wording but it sounds like it to me), the company would get $850K, the equity for 5M shares at 25c would be 400k (the 400k option 1.25M value -850k exercise fee =400k).
So assume that is correct, and I am not sure, I think it is, but I could be wrong. But if so Apollo owes a 850k exercise fee next month and higher if the share price goes higher. If the share price does go higher than they could sell the current shares but than the exercise fee is higher (assuming it is set at the same 32% discount rate which he quoted $3.8M total investment, so it might be fixed somewhere hidden in the S1). Anyway, I am not sure what the best strategy would be, seems like a double edged sword--higher price gives the current shares more value but the option shares next month require a higher fee). It seems right now they are content to let the sp stay here at this level for a while.
Nice move here. OTC has been dead the last few weeks, but overall volume has picked up today some.
With the share structure there is always a chance in OTC land. I added some yesterday and today to get me average down for the long haul, either way.
No, let me try to explain my understanding with an example from the table, the 30c row highlighted in red.
For 30c, they get a 32% discount or 20c exercise price Before they could get 32M shares at this option. So the shares would be worth $9M but they would have to pay the 20c per share exercise fee or $6M. So their equity, $9M-$6M=$3M. Now instead of paying an exercise fee, the cashless option would allow them to get $3M dollars worth of shares with no fee. This would be 10M shares (cashless option in highlighted row) but no exercise fee with their final equity is still $3M (their cashless option value), but the company gets no additional money the cashless method. Note the number of shares they get adjust so they always get $3M from 20c up to 1.50 after cashless exercise, it takes more the cheaper the share price. So they changed the agreement where the get to exercise $1M cashless and the remaining must be cash based. They can keep or sell the shares as they see fit, but they will not go over 10% holding. Well if do the math $1M cashless exercise at 24.9c 10 day vwap comes right under 4M shares, which is what the OS just moved up by. So I suspect that is what happened. The next option is 400k cash based option exercise due mid November and the company will get money on the cash based exercise. Again, all IMO. And I am looking forward to listening to the company explain it in their own words.
Looks like they did the $1M option at 25c vwap cashless exercise giving them 4M shares. They still have $2.072M left to exercise, but those must be cash exercise. If they did those right now it would be 25M shares at 17c exercise price. All, imo.
Agreed, looking forward to some EV news. Oct 15th is next Friday. I am guessing some movement one way or another soon, and I would expect some news to come with that.
If the price is below $2. They use the schedule A table I just attached adjusts the exercise price and the number of shares.
“Option in whole or in part (the “VWAP Average Price”) is less than $2.00, then the then- current Exercise Price shall be temporarily reduced for such exercise to an amount that is calculated in accordance with the dynamic Excel spreadsheet that accompanies the execution copy of this Agreement (and certain static versions thereof are attached as Schedule A) and, in each such case, as calculated, the number of Option Shares issuable hereunder solely for such exercise shall be increased in accordance with the formula set forth in such dynamic Excel spreadsheet (such additional Option Shares, a “Sub-option”).”
“Exercise Price. The exercise price per share of the Common Stock under this Option shall be $2.00, subject to the pricing module set forth on Schedule A (the chart following the signature page to this Option Agreement; the “Exercise Price”).”
Here is the table from the S1 that should help. They were getting basically 3M worth of shares for their $500k using the cashless option. Now it seems they get 1M worth at the cashless option and the rest, I am guessing the remaining $2M must be the cash option, so the company will get more money at least with this change. But I haven't had time to look in detail to see if that is correct. There is a limit in the S1, 20c is the lowest they can exercise the option.
The O/S update hit yesterday premarket. There is about 3M total difference in shares they get between exercising at 25c or 20c, 12M vs 15M shares. They can exercise on 10 day VWAP. So if I were them, I would wait to see if it dips. If it doesn't dip and takes off, the VWAP helps save them from waiting. But we will see with the next update, seems they update on Mondays at 8am lately.
$OWUV, gapping up from 6c to 10c this morning.
Should be a very liquid and interesting day
$IQST has a big offering coming up hidden in the 5M warrants for 500k at $2 is an adjustment. 10M-15M shares after cashless exercise depending on the share price VWAP over the last 10 days before they exercise ($3M dollars worth for $500k (3c-5c a share), almost criminally cheap. By far my biggest loss so far this year, I am going to try to average down and ride it up, assuming they sell for that big gain, and after the drop IQST runs.
From the S1A
$SHMP hit 16c this morning, crazy move from yesterday. $WINR the big volume winner today.
WSRC now 8s
Moving on this news
WSRC Signs $1.9 Billion Federally Funded Mitigation Agreement
https://www.otcmarkets.com/stock/WSRC/news/Western-Sierra-Resource-Corporation-Announces-a-1976-Billion-Federally-Funded-Mitigation-Agreement-Executed-September-17?id=374066
That looks interesting, I will have to take a look at it. I know there is an issue with solid state and fires, but haven't researched to understand the issues. I usually skip F stocks when scanning because my brokers seem to usually want $50 extra per trade or some like firstrade exclude F completely, but that seems to be the normal fee. Maybe since it is Canada, I need to look more at why some are usually and some are more commission. Chart looks good with 4c double bottom looks to me.
$TORVF
150MOS
I finally sat down and read through the S1A, 20c would be their optimal best price to covert because of options adjustment and being limited to 20 cent price ( 13.6 conversion after 30% discount), though they would be happy converting at the current today's close price (25-26c) in my opinion. And companies never PR options exercise. TA updates almost daily, you will know when the OS changes (the last update was yesterday 151.5M OS), which is how OTC traders normally keep up with dilution on stocks published on OTCMarkets (https://www.otcmarkets.com/stock/IQST/security)
Do you ever trade stock options-- calls/puts etc at a certain price? Say SPY today at 367 call or put?
Yeah, but when they exercise the shares, they also pay the exercise price. That is why share options are always of less value than actual shares.
Notice section B talks about the exercise price. That is the price they must pay to get the shares. They can either pay that price or use the formula for a cashless exercise, but they get less shares.
If the share price is 14c, the option price is 10c (meaning they have to still pay the 10c for the shares). So have to pay 500k and an additional 500k for the option or 1M for the 5M shares or 20c a share when the share price is 14c, still a loss of 6c per share. I think the break even price is around 30c, but I haven't sit down and figured it. I think the confusing point is the option price at 10c is what they have to pay to get the shares in addition to the 500k, not what they get, it is in addition (even though the 500k matches it is an additional 500k they must pay).
10c is not break even. At 10c they have 5M shares with the option at 7c, basically worth $150k, which they would have paid $500k for. A huge loss.
That would not make sense, because they pay $500k for 5M options (nearly worthless at that price), where as if the price was 10c, they could just buy 5M shares for $500k fully vested. I imagine they never thought the price would get anywhere close to 10c because of that.
I will also point out, using your example 30c and 20.4c exercise price, if they did that just to dump the shares, they would have to pay the exercise price also, or 20.4c x4.8M or almost $1M dollars. So $1.5M to the company for 500,000 shares or 33c per share, which doesn't sound like a great deal if the share price is 30c.
Or if they do the cashless option,
(.30-.204)/.30 = .32 or 32% of the 4,8000,000 shares = 1.5M shares. So 1.5M shares for $500,000, same 33c per share, which doesn't sound like a great deal if they can buy those at 30c.
IMO some people say that yesterday and panic sold, thinking it was 5M shares being sold for 500k, not 5M options, which has much less value at the current share price, which is why I bought 50k more yesterday to add to my long hold (I may add more today if they drop if more). We will see in the next couple years if that was a good investment