At current pricing 5:1, you could increase your exposure or more wisely take some off the table.
If you have $25k worth of NKP, it could be worth considering selling all then buying $5k of NKPO. Your exposure remains same.
But you are protected from downside.
The way I look at it, we have until Aug for NKPO plus they may be extended. Now, no matter what way you look at it, with cr and JV and BFS. It will be resolved by August.
If it all goes pairshaped, ie no JV, maybe a BFS downgrade and a heavily discounted cr then NKPO will be dead(but maybe extended). You've lost $5k. But your NKP would have lost atleast that much. So your better off.
If like we expect, those issues are resolved favourably, then say NKP 50c. Nearly double your money from here. But NKPO would be about 15c so outperforms.
Obviously their are values in between that probably better suit NKP over NKPO, but an extension might counter that. Also you need to weigh up whether its likely to be some in between value. A sp in limbo.
I would think limbo in Aug is unlikely. Its either good or bad news by then.
NKP Price at posting:
27.5¢ Sentiment: Hold Disclosure: Held
