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The empirical analysis of new warrant issues in the context of a structural model of the firm typically assumes the absence of debt and a perfect equity pricing model. We examine here an approach relaxing these two assumptions. The proposed approach develops simple analytical expressions for the...
Persistent link: https://www.econbiz.de/10013082129
Instalment warrants are very popular in Australia and these instruments have been listed by Nedbank and Standard Bank in South Africa.Instalments are financial products, that allow investors to gain direct exposure to shares by making a part payment upfront and delaying an optional final payment...
Persistent link: https://www.econbiz.de/10013082389
The exercise of a warrant leads to the well-known dilution phenomenon, whose effects have been extensively studied over the last four decades. In contrast, the existing literature has paid inadequate attention to the volatility spillover between stockholders and warrant holders. This...
Persistent link: https://www.econbiz.de/10013150865
Old National Bancorp was the first publicly traded bank to buy back its Capital Purchase Program (CPP) warrants. It paid $1.2 million, which is below the low-end of this paper's estimates of the fair market value of the warrants. This paper estimates the warrants are worth between $1.9 and $6.9...
Persistent link: https://www.econbiz.de/10013159847
This paper develops useful theory of arbitrage and risk arbitrage. It describes a prize winning successful risk …
Persistent link: https://www.econbiz.de/10012860879
This paper addresses the relationship between the capital structure and the systematic risk of common equity for a firm whose capital structure includes convertible securities. Adding warrants to the capital structure reduces the systematic risk of equity, which is consistent with the fact that...
Persistent link: https://www.econbiz.de/10013048452
Persistent link: https://www.econbiz.de/10013258996
This paper explores the tradition of awarding of royal warrants in monarchies in the EU. In order to determine the legality of awarding royal warrants, EU State aid law and national public law are analysed. The analysis shows that legal analysis of royal warrants rests on the public/private...
Persistent link: https://www.econbiz.de/10013246723
Persistent link: https://www.econbiz.de/10012326526
This article visits the question of whether canceled warrants (CWs) have a positive effect on LME metal prices. To examine this question carefully, a regression model is applied. This paper finds a statistically significant positive link between CWs and LME metal prices, including aluminum,...
Persistent link: https://www.econbiz.de/10012038512