OTC traders

[Bassmaster96]

Please tell me I'm not the only one taking an absolute slaughtering so far this week

[boneil]

Look into trading SPACs. I have been doing pretty well these last couple of weeks and I don't have to sit in front of a screen all day.

[Bassmaster96]

Look into trading SPACs. I have been doing pretty well these last couple of weeks and I don't have to sit in front of a screen all day.

How exactly does that work? I've heard a lot of buzz about them but haven't really looked into trading them too much

[haftafish22]

LPHM not pay?

[boneil]

How exactly does that work? I've heard a lot of buzz about them but haven't really looked into trading them too much

There's a reddit board that post alot about Spacs, and people on social media who posts about new listings, which is easier than searching SEC records. But basically, you find a spac with a management team that you like. In the prospectus it will outline the type of industry they are looking at as well as the details of the unit/warrant structure. Typically the Spac has 2 years to find a target. The Units get listed for about 50 days then split into common shares and warrants. I don't buy the units because Etrade charges to split the shares. I wait until they split to buy the commons and warrants. The commons have a floor on price, usually around 10 per share. Warrants are much cheaper, around $1, but can go to zero. Warrants give you a right to buy shares at a future date for $11.50, they are like options in a way.

There is usually a premium on the costs of Spacs with the better management teams. Typically the price will stay flat for a length of time until there are rumors. And usually a big pop once a target is confirmed. Things usually settle down for a bit while investors evaluate the value of the target. Then there is usually a run up into the merger date. The merger happens, the commons ticker symbol changes into the new company.

It's a good way for us little guys to get into a company in it's early stages, instead of the typical IPO where we are the last ones to get in. Unfortunately there are plenty of shady companies that are able to go public through this process, like NKLA. So there can be plenty of risk for long term holders if the company is a fraud.

So far I am finding little downside risk with the ones I have bought. I have made 100% on SHLL, 40% on IPOB, and up 15% on IPOC and SOAC who haven't announced a target yet.

Understand that I am new to these and I am sure there are risks that I am not aware of yet. Like I just learned the other day that Etrade would charge me to change my SHLL shares to HYLN.

[Hez]

This is interesting.

[Bassmaster96]

There's a reddit board that post alot about Spacs, and people on social media who posts about new listings, which is easier than searching SEC records. But basically, you find a spac with a management team that you like. In the prospectus it will outline the type of industry they are looking at as well as the details of the unit/warrant structure. Typically the Spac has 2 years to find a target. The Units get listed for about 50 days then split into common shares and warrants. I don't buy the units because Etrade charges to split the shares. I wait until they split to buy the commons and warrants. The commons have a floor on price, usually around 10 per share. Warrants are much cheaper, around $1, but can go to zero. Warrants give you a right to buy shares at a future date for $11.50, they are like options in a way.

There is usually a premium on the costs of Spacs with the better management teams. Typically the price will stay flat for a length of time until there are rumors. And usually a big pop once a target is confirmed. Things usually settle down for a bit while investors evaluate the value of the target. Then there is usually a run up into the merger date. The merger happens, the commons ticker symbol changes into the new company.

It's a good way for us little guys to get into a company in it's early stages, instead of the typical IPO where we are the last ones to get in. Unfortunately there are plenty of shady companies that are able to go public through this process, like NKLA. So there can be plenty of risk for long term holders if the company is a fraud.

So far I am finding little downside risk with the ones I have bought. I have made 100% on SHLL, 40% on IPOB, and up 15% on IPOC and SOAC who haven't announced a target yet.

Understand that I am new to these and I am sure there are risks that I am not aware of yet. Like I just learned the other day that Etrade would charge me to change my SHLL shares to HYLN.

Okay, that's cool. Sounds kind of like custodian plays. I'll definitely look into sounds like something right down my alley.

[Bassmaster96]

LPHM not pay?

Sold today for 360% so I definitely can't complain about that one

[haftafish22]

Sold today for 360% so I definitely can't complain about that one

ill be waiting on my Christmas bonus. Don’t be late

[haftafish22]

Okay, that's cool. Sounds kind of like custodian plays. I'll definitely look into sounds like something right down my alley.

thats exactly what it is.

[Bassmaster96]

ill be waiting on my Christmas bonus. Don’t be late

Of course it's up today after I sold