Question, probably been asked, but I don't see it.. if I buy today?
If I buy at 13.40 today, do I still get $13.65 for my shares, if so, it seems like a no brainer to me??? (and yes, I have no brains, and shouldn't be trading stock, but it's some extra cash that was going to waste in the bank)...
Lots of money on Wall Street that do merger arbs and you can bet they are in this stock. My advice is dont play that game as you know going in what your upside is. Risking any money for a 1-2% upside is just not wrth the risk that the deal doesn;t close. Remember where the stock price was before thiswhole thing started.
If the deal goes through. But the deal may take several months and meanwhile you are capped at 13.65 to the upside if the deal goes through, but you still have downside risk if the deal fails. That is how the pessimist sees it.
The optimist sees it as a minimum of 13.65 and maybe more if the offer is raised to subdue the angry shareholders that are bringing lawsuits.
The optimist sees it as a no brainer to buy. The pessimist sees it as a no brainer to sell.
Yes, and the word for what you are suggesting is arbitrage.
Usually arbitrage opportunity is just about .05 cents . In this case the spread is much larger, .25 cents, because of the $3 or more downside risk if the deal falls apart.