The units were already split, so it's either the common or the warrants. I see it as a bet on two things: the team's ability to do a good deal as well as the market environment/persisting enthusiasm for SPACs (chance of bump upon deal announcement that allows investors to choose between profitable exit or long-term stay). I think pre-deal SPAC equity is already somewhat asymmetric given limited downside.
As I understand it, the split is not mandatory. You can still buy the units. I like the units best because you have the large downside protection and still get some exposure to the warrants (1/5). So you go for the common?!
My apologies, you're right: it wasn't a mandatory split. I agree, when the premium is small I prefer the units: downside protection and some warrant kicker. To consider the warrants by themselves I would need higher conviction.
Interesting idea and it still trades cheapish. Do you buy the units, the common, the warrants or none of the above?
The units were already split, so it's either the common or the warrants. I see it as a bet on two things: the team's ability to do a good deal as well as the market environment/persisting enthusiasm for SPACs (chance of bump upon deal announcement that allows investors to choose between profitable exit or long-term stay). I think pre-deal SPAC equity is already somewhat asymmetric given limited downside.
As I understand it, the split is not mandatory. You can still buy the units. I like the units best because you have the large downside protection and still get some exposure to the warrants (1/5). So you go for the common?!
My apologies, you're right: it wasn't a mandatory split. I agree, when the premium is small I prefer the units: downside protection and some warrant kicker. To consider the warrants by themselves I would need higher conviction.