Talga is essentially a call option - heard that saying by others...

Talga is essentially a call option - heard that saying by others on here before, below is why

• p = probability of SC Decision in our fav
• And let's say SP is $1.80 if SC decision is in our fav (what it was prior appeal)
• Let's say SP is $0.10 if SC decision against us

Current share price
p x $1.80 + (1-p) x $0.10 = current share price of $0.47

Implies p = 21%

Option

Now what does that look like for an option

Downside = no loss
Upside = 1.80

21% × 1.80 = 37c

If each option is 37c, then the value loss is 1/8th = 4.6c

I'm expecting it to drop around 5c on the ex date (around 10%)

Q.E.D.