Member Info for Poleaxe

8.4bn including the rights, unless I'm mistaken

How do yu know it's short sellers dropping it today? Where do you get the stats?

No worries Don2003. Thanks for confirming. It's irritating some will allow, but not IG. I don't think IG have permitted the opening of new positions in RRN at any time, not even on 28th.

IG can get a bit muddled sometimes - a case of people making decisions they've not been trained to make perhaps. e.g. I heard this morning they suspended trading on BWNG because of the 'corporate action'. I don't see why a placing and open offer should be cause to suspend trading.

Don2003, obviously IG will let you sell your existing RRN rights, but will they let you buy more...or short them?

That's odd Don2003. I've just tried again to place a buy order and I get "This market is only available for closing deals", that's both CFD and ISA. Perhaps possible to buy in shares account?

A trader friend spoke to IG about it yesterday and they told him they didn't want to get bogged down by the admin! That sounds odd for a FTSE 100. Perhaps they found HMON a lot of hassle?

Ratty, how do you know what the majority of people do? I wouldn't take this bulletin board as being a representative sample of real investors.

Brokers will have spelt out the three options:-

1) Take up the rights
2) Sell the rights
3) Let them lapse and receive lapsed rights proceeds

If investors don’t understand these simple instructions, what chance is there they'll appreciate the investments risks, as explained in the rights prospectus?

I think you may be confusing the survival of the business activities with the value in the equity investment. Shareholders could get wiped out but I dare say engines would still get made. Engines would still get maintained.

RR.(cum rights) = 4.3333* RR.(now) - 106.667

taiz, holders have been able to sell the rights shares since 28th, when they were admitted to the market.

Holders have had the choice of whether to sell them (could have got 68p or so on 28th), or to pay 32p to have them exercise the rights to beome fully paid RR. There's no point paying 32p to take up the rights for a quick turn, unless you expect to get a decent premium over where you could sell them now, nil paid.

Why would there be a big dump of '32p shares' gfrom 12th? Why would people take up the rights for a quick sell when they could have simply sold nil paid and saved the hassle, saved tying up the extra cash and saved the market risk of being locked in for several days? Only a few inexperienced investors who don't understand rights issues I suspect.

Er, because the auction extension was the reason why trades were not getting exectuted. I explained why there was an auction extension.

Sorry, I didn't realise this place was limited to long term private investors. Judging by the frequent comments on the price and direction the stock is taking I mistook you for short term traders.

RR. auction was extended 5 mins, because indicative uncrossing was below opening price monitoring threshold (5% in the case of a FS10 sector stock).

If you want to trade, it's good to learn how the market works.

Yes Wile, the shares not subscribed for will get placed on 12th. It will get done at a good price (for the buyers) but I'd only expect a brief dip.

That's your interpretation Dinvesotoy.

These are the % take ups and rump placing prices of some recent rights issues:-

Date Ticker Take up Placing Price now Loss
10/6/2020 WTB 91.4% 2,550p 2,222p 12.9%
12/6/2020 HYVE 98.9% 115p 52p 54.8%
29/6/2020 MTO 93.4% 31p 27.25p 12.1%

And rumps don't get placed at great prices to start with.

If you're planning on buying RR. shares you take a look at the RRN price and, if it works out cheaper that way, you buy RRN. If you were buying in the closing auction today it would work out 1.5p per share cheaper to buy via RRN.

Plus you save a bit of stamp duty (you don't pay stamp duty or dealing charges on the 32p).

Not all brokers will allow PIs to trade RRN. e.g. IG won't allow me to, and I'm a pro client. It seems odd, as surely PIs would aid liquidity? Perhaps PIs are insignificant compared to institutional traders.

There were about 113m RRN shares traded on the LSE today (are they also traded on other venues?) That's only a small fraction of the 6.4bn RRN shares in issue. To me that suggests at least 90% of the rights are going to be taken up, quite possibly over 95%. We'll know on 12th.

A nice RR. short/ RRN long arb at close today, if your broker would let you open new positions on RRN (IG won't let me). That's a 1.5p scalp with decent liquidity.

There you go!

Scream!!!!

Meanwhile, I think RR. could auction before close

Cosm, investors who bought close to £1 will, like any other investors have the choice of selling the nil paid rights or excercisng the rights at 32p. Logically you'd only want to take up the rights if you think the RR. price will be higher when you come to sell than it is now.

As I type RRN trade at almost 48p. If I exercise the rights that means I've got to be expecting to sell on or after 12th for more than 80p, otherwise, what's the point?