I’m about 95% sure that’s the case. It goes with that whole SPAC Arbitrage approach. There’s actually zero risk in this trade.
OT: Stock and Investment Talk
- Thread starter RU-05
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Not if you buy in the secondary market. You need to be in the trust/original IPO.
The people that do that get a free option. There is a group of investors which use these vehicles to park cash, get tbill interest, free warrants and then just take their money out unless the spac is trading way higher and they can quickly flip those shares. It's a terrible structure.
There are also good groups of investors that are doing it the right way but they aren't many of them.
How sure are you about this? I’ve held spacs I’ve purchased on the secondary market and have had the option to redeem. Think about it, if you buy at IPO and sell two weeks later, the option to redeem goes with the shares, it doesn’t disappear. It’s half the reason many speculate in the spac market.
A Tale of Redemptions
A popular route to the public market is looking shakier lately.
Fed Governor Waller says half-point rate hikes could be needed as 'inflation is raging'
Fed Governor Christopher Waller said the central bank may need to enact one or more 50 basis point interest rate hikes to tame inflation.
How sure are you about this? I’ve held spacs I’ve purchased on the secondary market and have had the option to redeem. Think about it, if you buy at IPO and sell two weeks later, the option to redeem goes with the shares, it doesn’t disappear. It’s half the reason many speculate in the spac market.
A Tale of Redemptions
A popular route to the public market is looking shakier lately.www.nytimes.com
When I say secondary market I am referring to the public markets because technically what they are.
Did you buy those on the public markets or did you get them some other way?
There are different share classes for this AEA-Bridges:
www.aeabridgesimpactcorp.com
This group spells it out very clearly, which is a good sign. Click down on the stock data tab and you can see the details of each shares class and the warrants.
finance.yahoo.com
finance.yahoo.com
Notice that the IMPX has all the volume/market cap etc. The IMPX.U shares trade at a premium of 10.31. Those are the redeemable shares.
IMPX.U
www.aeabridgesimpactcorp.com
This group spells it out very clearly, which is a good sign. Click down on the stock data tab and you can see the details of each shares class and the warrants.
Symbol Lookup from Yahoo Finance
Search for ticker symbols for Stocks, Mutual Funds, ETFs, Indices and Futures on Yahoo! Finance.
finance.yahoo.com
Symbol Lookup from Yahoo Finance
Search for ticker symbols for Stocks, Mutual Funds, ETFs, Indices and Futures on Yahoo! Finance.
finance.yahoo.com
Notice that the IMPX has all the volume/market cap etc. The IMPX.U shares trade at a premium of 10.31. Those are the redeemable shares.
So which is the one with most upside? Most risk? IMPX, IMPX.U, or IMPX.WS?There are different share classes for this AEA-Bridges:
IMPX.U
This group spells it out very clearly, which is a good sign. Click down on the stock data tab and you can see the details of each shares class and the warrants.
Symbol Lookup from Yahoo Finance
Search for ticker symbols for Stocks, Mutual Funds, ETFs, Indices and Futures on Yahoo! Finance.
Symbol Lookup from Yahoo Finance
Search for ticker symbols for Stocks, Mutual Funds, ETFs, Indices and Futures on Yahoo! Finance.
Notice that the IMPX has all the volume/market cap etc. The IMPX.U shares trade at a premium of 10.31. Those are the redeemable shares.
8-1 vote for quarter point raises. Time to stop the fear mongering.Fed Governor Waller says half-point rate hikes could be needed as 'inflation is raging'
Fed Governor Christopher Waller said the central bank may need to enact one or more 50 basis point interest rate hikes to tame inflation.www.cnbc.com
IMPX has the most risk. It's just common stock.
IMPX.U is the insider shares you can redeem just before company combines with the SPAC. Those are low risk, high reward.
IMPX.WS are the warrants and have no risk, all upside. You get those for free for being part of the IPO and you can sell those immediately. These are the shares that are sold hard right after the IPO because its all gravy.
Not fear mongering, if they can be flexible in one direction why can't they be flexible in other too with regards to the speed even if total increase ends up in the same area. Point is it's unknown to some degree even though he is trying to telegraph it.
The SPAC Ship Is Sinking. Investors Want Their Money Back.
One of the pandemic’s hottest trades is cooling down, as the hype surrounding “blank-check” companies gives way to reality. The threat of tighter regulation is looming, and high-profile stumbles have taught investors some tough lessons.
www.wsj.com
Re SPACs, there are risks. Personally, they don’t appeal to me because of structure, lack of transparency, and the unknown.
First 3 good, 4th good-ish although do wonder about valuation (190 level I had mentioned broke but was quickly retaken and has since held though) and last one not for me.
Still like FB too and it's finally showing a little bit of upside momentum. Short term looking better on the RSI and MACD. It would be good if it can break out of this 210 area.
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I never heard of it but assume its possible. If you had the redeemable shares then that's a great deal.
I'm not really knowledgeable about SPACs because it's not my risk tolerance or thing but what you say about buying off the secondary market sounds reasonable to me. Any of the "properties" bestowed on the shares at issuance seem like they would go along with the shares through sales from party to party, unless there is some specific clause stating otherwise.
SPACs sound maybe like a little twist of when other investments get called in at par. Like I've had CDs, debt or preferreds where par is 100 or 25 and bought them off the secondary market at a discount..so the interest rate is actually higher than the face value at issuance. But when they get called in by whatever institution you benefited from all the interest you collected plus the fact that it gets called back at par value which was above the discount you bought it at. That trait doesn't go away because they were bought on the secondary market. I'm not sure if what you're talking about is similar with SPACs but the discussion sounded something in that vicinity at least. Maybe I'm wrong.
BTW, I've always understood anything not bought at the time of issuance to be the secondary market. I mean even the stock market is a secondary market but most might not think of it like that on first blush. I guess most or a at least a retail person like myself would think of the secondary market with regards to other investments like CDs, preferreds, debt etc..
You guys could be right about the redeemable shares.
Don't forget to focus on the dilution. Between the shares given to the sponsors and the warrants their is a lot of dilution so if you decide to stay in there are a lot of shares out there that cut into the value of your shares.
IMPX is a $400 spac, currently trading at 9.90 with a market cap of $495M. That's basically $100M in free shares floating out there.
Obviously if you redeem this doesn't matter.
Don't forget to focus on the dilution. Between the shares given to the sponsors and the warrants their is a lot of dilution so if you decide to stay in there are a lot of shares out there that cut into the value of your shares.
IMPX is a $400 spac, currently trading at 9.90 with a market cap of $495M. That's basically $100M in free shares floating out there.
Obviously if you redeem this doesn't matter.
This part is a little different from the instruments I mentioned. So this part and what it entails I'm more ignorant about and if there are any clauses or issues i don't know. The ones I mentioned, it's the issuer that calls in the CDs, preferreds, debt etc..the holder has no say in that or when it happens. It sounds like with SPACs you as the holder have some say.
Yes, right before the de-spac you will get the option to get your money back. It's a strange process. Since you don't know if everyone else is going to stay in, most people are getting out now that's why the redemption rates are so high. Last spring these spacs were mostly trading higher and people didn't redeem. Now you are seeing 80-90% redemptions which is a disaster for the company. They get no money on the balance sheet and the stock trades down hard.
But you are right the devil is in the details. You need to read the prospectus for each spac because they are not all the same. Different warrant coverage, sponsor equity, etc.
Lots of green across tech and a couple of the big time laggards in FB and PYPL showing some nice relative strength. High PE or no PE names (not for me but for some who may own here) nice as well today. SOFI up 10%.
Good day for those leveraged ETFs. :)
Clarity is a beautiful thing:
Investors come off a strong week looking for more gains now that they have some clarity from the Fed
With the Fed's first rate hike out of the way, market pros are now debating whether the market can continue the upswing it started in the past week.
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SOFI is interesting here. Lot's of resistance coming up above 10. It has been trading down in a channel as well. It is overall a very good company with good management. It is more diversified than other pure fintech companies. I would have thought that obtaining a bank charter would have been a big time catalyst, but it hasn't worked out that way. I am not big into conspiracy theories, but with this one, I wonder. There is also a high short interest in the stock and could be primed for a squeeze on good news. My guess is that it will eventually go higher, but may continue to bounce around at first. However if it decisively has a breakout above the channel then it will go to the moon.
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Some positive NKE comments on Fast Money. Didn’t buy at that support area around 115ish I mentioned but took a shot in the low 120s when it bounced.. Sold some but still holding some for earnings to see how it goes. If it doesn’t go well might buy back in that 115ish area and then next area after that 90-105 that I mentioned. Worth mention a trade up to 145 resistance. It’s currently low 130s.
That’s about the only no PE type name I’ve been wondering about but have never got in. Just been observing how it trades. I was thinking it had a decent range from
low-mid 10s to mid 12s. Was thinking if I did get in it would be at the low end of the range with a stop out at 9.50 or so. In the end though I stayed out and just keep watching and of course it broke that bottom end of the range.
It has been trading in the downward channel since end of November 2021. Current top point of the channel would be around 10.7. If it breaks out above that then it will blast through especially given that it is ~20% short. As for the 10-12 range, I can see where you noted that in the chart, but it only was in that range from late January to early march. I don't generally get too excited for movement during such a short time frame and it was quite volatile during that time.
None that I have seen yet. Just for broad market or sector indexes. Oh, but I did seen on CNBC a week or two ago that one of the companies (don't think it was Proshares) is coming out with individual stock leverage ETFs! So you can get AMZN at 3x. Go big or go home!
Looking ahead, big Tuesday next week!
Tuesday: Nvidia, Adobe
Nvidia
Adobe
Tuesday: Nvidia, Adobe
Nvidia
- Investor Day at 1 p.m. ET
Adobe
- Q1 2022 earnings release after the close; conference call at 5 p.m. ET
- Projected EPS: $3.34
- Projected revenue: $4.24 billion
This market was so desperate for a relief rally. Will be interesting to see if there is a lot of profit taking next week. Like I said before, Putin is either on the ropes or just waiting to choke out a few Ukrainian cities before he starts making ultimatums.
The market can only be irrational and emotional for so long.
You know, you can create your own triple leveraged ARK ETF's using the derivative market.
He is on the ropes, and I am hoping that one ends up around his neck soon!!!!!!!!!!!!!!!!!!!!!
Yea I see that but 50DMA is just above that channel too in the mid 11s and I think there is resistance in the mid 13s as well. I suppose short covering could push it through those levels temporarily but don't know if it would last but for a trade I guess it wouldn't matter. Volume has been higher for this downward move too which I don't consider a great sign longer term until the trend changes.
*SARK is an actively managed exchange traded fund that attempts to achieve the inverse (-1x) of the return of the ARK Innovation ETF (NYSE Arca: ARKK) for a single day, not for any other period."
