Other
The Synthetic Convertible Security
Richard Croft
Consensus wisdom puts forward the position that traders who buy options are speculating. But that is far too general a statement. Long only strategies the synthetic convertible – i.e. the combination of long calls and a fixed income instrument – can actually reduce risk. Traditional convertible debentures or convertible...
Fertilizer Wars!
Richard Croft
Are the sum of the parts worth more than the whole? When it comes to Agrium Inc. (AGU, Friday’s close $98.86) the company’s Board and its major shareholder (Jana Partners LLC, an activist hedge fund domiciled in New York which owns 4% of Agrium’s outstanding shares) find themselves at polar ends of a valuation spectrum....
A RIM Do Over?
Richard Croft
The shares of Research in Motion (TSX: RIM, Friday’s close $8.22) have moved higher in the last few days with the biggest spike in price occurring last Wednesday. You may recall my post on June 30th where I talked about a RIM death spiral and to my mind I see no change in the fundamentals of the company that would alter my...
A Preferred Share Alternative
Richard Croft
Despite the lack of guarantees normally associated with fixed income securities, individual investors generally consider preferred shares a reasonable alternative to bonds. Probably the result of the favorable tax treatment that the Canadian government accrues to dividends. To that latter point, the after tax return on...
Playing a European Renaissance
Richard Croft
Mario Draghi, head of the European Central Bank (ECB), pledged to do whatever is necessary to save the euro and the eurozone. Promising to deliver “enough” as long as it falls within the ECB’s mandate. Like any well oiled propaganda machine the most influential European politicians lined up behind Draghi and stoked the...
Is the Bear Calling?
Richard Croft
One can make the case that global markets have turned over and are now entrenched in a bear market phase. Global growth is slowing – particularly in China – and the eurozone collapsing under the weight of recession and political apathy. And while the US markets may be the best house in a bad neighborhood I see nothing that...
Seeking Alpha With Long Straddles
Richard Croft
I’ve been doing some research on the prospects of buying close-to-the-money straddles. Actually I dusted off studies I had done a number of years ago and surprisingly – or perhaps not – the results today were very similar to previous iterations. More to the point, the results seem to be the same in virtually all...
Hedging Canadian Content against a Global Break Down
Richard Croft
First the backdrop… We rarely hear much out of the fringe countries in the eurozone but last week, Finland’s Financial Minister Jutta Urpilainen shared an incisive point of view. She intimated in the Finnish financial daily Kauppalehti, that her country will not be a part of an “integration model in which countries are...
The RIM Death Spiral!
Richard Croft
Last week we bore witness to the final death spiral for what was once an innovative Canadian icon. It was not the fact Research in Motion (TSX: RIM, Friday’s close $7.54) reported its first quarterly loss. That was telegraphed to the market well ahead of time. What was not telegraphed was the size of the loss which was three...
Trading Open Interest
Richard Croft
Open interest is the number of open option contracts in a specific series that must be closed out by the expiration date. A “series” being defined as options with the same underlying stock, type (either a call or a put) same strike and expiration. Open positions can be closed prior to expiration when one executes a closing...
The information provided on this website, including financial and economic data, quotes and any analysis or interpretation thereof, is provided solely for information purposes and shall not be construed in any jurisdiction as providing any advice or recommendation with respect to the purchase or sale of any derivative instrument, underlying security or any other financial instrument or as providing legal, accounting, tax, financial or investment advice. Bourse de Montréal Inc. recommends that you consult your own advisors in accordance with your needs before making decision to take into account your particular investment objectives, financial situation and individual needs.
All references on this website to specifications, rules and obligations concerning a product are subject to the rules, policies and procedures of Bourse de Montréal Inc. and its clearinghouse, the Canadian Derivatives Clearing Corporation, which prevail over the content of this website. Although care has been taken in the preparation of the documents published on this website, Bourse de Montréal Inc. and/or its affiliates do not guarantee the accuracy or completeness of the information published on this website and reserve the right to amend or review, at any time and without prior notice, the content of these documents. Neither Bourse de Montréal Inc. nor any of its affiliates, directors, officers, employees or agents shall be liable for any damages, losses or costs incurred as a result of any errors or omissions on this website or of the use of or reliance upon any information appearing on this website.
BAX®, CADC®, CGB®, CGF®, CGZ®, LGB®, MX®, OBX®, OGB®, OIS-MX®, ONX®, SCF®, SXA®, SXB®, SXF®, SXH®, SXM®, SXO®, SXY®, and USX® are registered trademarks of the Bourse. OBW™, OBY™, OBZ™, SXK™, SXJ™, SXU™, SXV™, Montréal Exchange and the Montréal Exchange logo are trademarks of the Bourse. All other trademarks used are the property of their respective owners.
© 2024 Bourse de Montréal Inc. All Rights Reserved.