Hi, Shrewd!        Login  
Shrewd'm.com 
A merry & shrewd investing community
 Best Of BRK.A | Best Of | Favourites & Replies | All Boards | Post of the Week!
Search BRK.A
Shrewd'm.com Merry shrewd investors
Best Of BRK.A | Best Of | Favourites & Replies | All Boards | Post of the Week!
Search BRK.A

Stocks A to Z / Stocks B / Berkshire Hathaway (BRK.A)
Unthreaded | Threaded | Whole Thread (14) |
Author: mungofitch ✹🐝🐝🐝🐝 SILVER
SHREWD   😊 😞
Number: of 15062 
Subject: Re: Done buying OXY?
Date: 06/22/2023 4:46 PM
Post New | Post Reply | Report Post | Recommend It!
No. of Recommendations: 9
It is a deep in the money very long dated $22 call option with virtually no premium (currently about $0.20). Try getting that in the options market.

I presume the apparent cheapness is because you're not getting the dividends that the common will get.
To do the apples-and-apples price comparison, you have to compare (Strike+OptionCost) - (StockPrice-ExpectedDividendsTillExpiry)
This presumably indicates that the leverage is far from free.
Though it certainly ties up a lot less capital.
(incidentally, the dividends in question are regular dividends...special dividends cause strike prices to get adjusted, so you don't lose those)


As an aside, it's fun to see how "conventional wisdom" on OXY is such a big mismatch vis-a-vis Mr Buffett's apparent view.

Occidental shares have little investment
merit, at this juncture. Capital
gains potential in both the 18-month span
and out to 2026-2028 lacks appeal. Too,
the dividend yield is not exciting. The
Timeliness rank is only Average, as well.
May 26, 2023

Jim
Post New | Post Reply | Report Post | Recommend It!
Print the post
Unthreaded | Threaded | Whole Thread (14) |


Announcements
Berkshire Hathaway FAQ
Contact Shrewd'm
Contact the developer of these message boards.

Ticker or Board Name Author

Best Of BRK.A | Best Of | Favourites & Replies | All Boards | Followed Shrewds