Question
Suppose that the stock A is currently sold at $617.5, the price of thecallwarrant on the Tencent is $0.280, the hedge ratio is 0.2133, the
Suppose that the stock A is currently sold at $617.5, the price of thecallwarrant on the Tencent is $0.280, the hedge ratio is 0.2133, the strike price is $988 and conversion ratio is 100. Find the warrant premium and the effective gearing of the call warrant. You are also required to interpret your answers.
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Entrepreneurial Finance
Authors: J . chris leach, Ronald w. melicher
4th edition
538478152, 978-0538478151
