The Market was not able to absorb selling pressure from bonus options issued to CRJ shareholders today.
20 cent options CRJO are trading at 11 cents.
Purchase options for 11 cents and convert to fully paid for an additional 20 cents - total cost is 31 cents.
Fully paid shares are trading at 35 cents ie 4 cents or 13% upside.
Fair value for options should actually be around 20 cents, 15 cents for premium to stike price + 5 cents in time value to September 2007 expiry.
Current opportunity is as a result of the options being issued to existing share holders for only 1 cent and allocated for non-deferred trading as of today.
arbitrage opportunity in crj options
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