Now that the window to convert warrants (DJTWW) into shares (DJT) is open, by paying $11.50 per warrant to convert, then the price difference between warrants and shares SHOULD stay pegged very closely to shares being traded at an $11.50 premium, compared to warrants... But they're currently not.
As I type this, that premium is only $8.63 which means shares are priced at a bargain, compared to warrants. So, basically, $11.50 minus $8.63 equals a discount of $2.87 currently.
Because of this, I'm temped to sell my 2,000 warrants, and use that $ to buy 1,280 shares. Doing this would mean, essentially, that I would be saving ($2.87 x 1,280 = $3,673) vs. if I wait to convert those warrants down the road.
This is in an IRA, so there is no tax implication for doing this. I just wanted to see if anyone had any thoughts on this that I might be overlooking, before I go ahead and do this. Thanks.
It's entirely possible it will work out that way. Since I first started investing I have done a little bit of selling --> buying. I have made money on these deals (or rather, I have more shares than I would have if I had just held the shares), but I have kept this to a minimum because a) you never know when the stock price is going to turn and b) I feel like not playing that game is an important part of what's going on.
Nevertheless, I have done this a few times over the past couple years. It can certainly work.
I think it's currently on a downward trend. I personally would sell a few shares (a couple hundred maybe), store that as cash for a bit, then buy warrants when it goes down. Play that game a few times. Doing it immediately is, I think, a lot less likely to be as fruitful. I usually don't hold it as cash for more than a couple weeks at a time.