Alerts & Commentary
Alert – RMBS
RMBS
Yesterday’s events in Judge Whyte’s court and today’s subsequent price reaction is a perfect example of why we execute the types of hedges, and overweight hedges, that we do when we are expecting news in a high volatility stock like RMBS.
The good news is, that while JW decided to delay (stay) the FEB 17th trials vs Samsung, Nanya & Micron until MAY (at least), due to the contrary spoliation ruling from the Delaware court in the Micron case… he will work swiftly to certify the Hynix trial and the pending spoliation ruling against Samsung, so that all of these completed rulings and the certified Hynix trial result can be sent to the Appeals Court together with the Delaware spoliation ruling and can be decided once and for ALL.
This probably means ST weakness until the Hynix trial is certified, but there is still the possibility he will NOT rule on the remedy (damages) against Hynix until the Appeal is completed. This would almost certainly result in further weakness in the stock price over the near term.
The bottom line to all of this uncertainty is that we will continue holding our ST overweight hedges and hopefully he will certify and decide on damages (or a stay on damages) before expiration, so that we may collect our overweight ST profits from our FEB hedges…
…and THAT would be very good indeed.
If you have any questions, please send those along.
Coach BD
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