WOW! That's the worst R/S ratio I've ever seen.
Late last year, I had a position in SymPowerCo. But after holding for six months I recognized it to be a major Dilution Pig. So I dumped out of it at a loss and stopped following the forum and the stock.
However, this 100-minimum share roundup clause might be fun to play for a quick gain. But this company is probably going to start diluting again immediately, so the stock really has NO future at all, IMO.
So IF I wanted to participate, the way it would work is I would probably have to buy at the current Ask of .0002 and probably buy at least one round lot of 100 shares for a purchase price of $0.02 total. Add to that my TDA commission of $9.99 and I would have a total out-of-pocket expenditure of $10.01
And after the R/S I would STILL have 100 shares. And if the R/S ratio affects the PPS in a linear fashion (doubtful) then the share Ask price SHOULD BE about $20. So my position would be worth about $2000. Of course, you can't typically sell at the Ask. And there is no way of telling what the Bid will be.
But assuming the same ratio holds, then the Bid might be about $10 and I could sell out my position for $1000 minus my $10.01 buy-in. BEST CASE I would realize a profit of about $990 on a $10 investment.
That is about a 9,900% gain or ROI. Best Case. Not bad for a short term play. (someone please check my math)
But there are a lot of unresolved "IFs" in this situation. If the stock doesn't hold its PPS ratio, and they seldom do following a R/S, then I might only get something like $50 which is still a 400% gain.
Just playing with the numbers here, as a way of explaining these Round-Up Clause plays. PLEASE, this is NOT a recommendation that anyone should actually buy into this situation.
All just my opinion...
VV
AI
