Lets say the heads go to the following price by October. Have a look at the reward comparisons based on an approx $1 close on the fully paids today and 35 cents for the options:
Shareprice Fully paids profit % Options profit %
$1.30 +30% -16.6%
$1.40 +40% +16.6%
$1.50 +50% +42.8%
$1.55 +55% +57%
$1.60 +60% +71%
$1.70 +70% +100%
$2.00 +100% +214%
Yes, the profit on the options will be much larger if the shareprice goes to $2, but in order for the options to outdo the profit on the options, the shareprice will need to be at approx $1.55 by october. But what about the risks:
hareprice Fully paids loss% Options loss%
$0.90 -10% -100%
$0.80 -20% -100%
$0.70 -30% -100%
$0.60 -40% -100%
$0.50 -50% -100%
The risk/reward situation is far more in favour of the fully paids at this stage.
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