Instalment warrants

[JohnnyCash]

Out if interest, what happens to an instalment where the underlying price have falling soooo much that the warrant is technically worth less than zero? Im not talking of the HOT or barrier type. Case in point the SB one on Investec? Use to own some but got out a few weeks ago. If there is still sufficient time on an instalment can it come back into the money?

[SimonPB]

it can come back into the money, in theory. In reality it depends on the underlying of course.

[JohnnyCash]

Simon, ok so in practice this can happen as well? Because it is not a HOT/ Enhanced there's no barrier. Your only problem will be the time left? For the SB Investec (think it is B) times running out but if it still had till next year to go it could be possible to come back from the dead and in the mean time still to receive the divi? But isnt the issuer then picking up the further decline in the underlying?

[#4]

With the volatility in the market right now, there is always a possibility that it can come back into the money, even if it quite far out of the money now. But it is difficult to imagine financial shares recovering so dramatically in the short term. There's just too much uncertainty with the deleveraging going on right now.