options value, page-3

Lady Speculum,

Even though I see very many advantages in buying the options over the shares, there are a couple of possible disadvantages:

A. In the event of a PRO RATA entitlement or rights issue, the benefit would only be to the shares. However, you quite often have time to convert them into shares if the entitlement date is quoted in the future. Secondly, GPN didn't make the last entitlement into YRR pro rata, but rather just being a shareholder was sufficient.

B. In a market surge, the option price will generally lag behind the shares - as big players chasing possible discussions with the company will generally own buy fully paid shares. But the option's price will generally return to fair value within a couple of days. If you're a long-term holder, which I believe you are, then that shouldn't be a problem.

You should be able to get set early on Monday. I anticipate the Aurium float to be announced either Monday or Tuesday. They need to give 28 days' notice (I had previously believed that it was 21 days; sorry about that), so they have missed the opportunity to make it the same date as the YRR meeting (5 June).

Best wishes.