Buying the common shares makes sense if you want to trade for short-term gains. However, if you prefer having leverage (controlling more shares with same amount of money), the RXIIW warrants are the way to go.
Think of the warrant as a type of standard option with a few differences:
1) Strike price is $0.90 and expires 12/21/2021. I figure RXII will either succeed or fail long before that date.
2) Warrants are traded and are less liquid than the common (just like options). Meaning there's a larger percentage buy/ask spread than the common. Once the warrants are in-the-money, liquidity will increase (just like options).
3) Unlike options, 1 warrant = 1 share
4) Warrants are issued from the company (RXI), rather than from other shareholders
5) RXI has the choice to call-in the warrants (similar to callable bonds), when the share price is 300% of the strike price (ie, 300% * $0.90 = $2.70). The warrants would expire worthless in 30 days if not redeemed, but this is not a problem since you are exercising the warrant at a favorable price.
6) Current price: Warrant = $0.20, with the common = $0.78
Leverage = $0.78 / $0.20 = 3.9
7) There's 10-11 million warrants, so their exercise would be dilutive (ie, would create 10-11 million common shares)
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