Ouch. I made nearly 8x my money today. Held $10k worth of...

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pastperformer

7,627 Posts.

2321

07/12/23

16:09

Post #: 71330698
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Originally posted by volf: ↑

Sadly the odds of MGF being converted to an active ETF are now approaching 0.

Magellan Group is under too much pressure and shareholder backlash from MFG investors should they convert to an active ETF, pay $150m to do so, then likely to proceed to lose a large chunk of that option FUM and existing MGF FUM would be too great.

There is obviously still a chance the MGF discounts closes but as things stand I believe the chances of that happening are also lower than I initially expected since they have pulled back on the buyback because it also reduces FUM.

Options are still worth something but its now probably a 1/20 chance with a ~13c payoff, so fair value of about 0.7c an option in my view.

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Originally posted by pastperformer: ↑

Converting to an active ETF was never the most likely option.

Magellan are aware of the discount are currently working on a plan to close it. I can't say what that is because I don't know but i have spoken with them directly.

Magellan need to start fresh and reset the business. Starting with an annoyed investor base won't be the way forward. What makes you think the buyback has stopped? I see no evidence of that.

In terms of your 0.7 cent valuation, that's completely arbitrary obviously.

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Ouch. I made nearly 8x my money today. Held $10k worth of options.

You must feel like an idiot for trying to pump then sell in to everyone.

MGF Price at posting: $1.89 Sentiment: Buy Disclosure: Held
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