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"After I bought some HON, there was some very good news. The phone rang and I was told I had won $500 in free gas vouchers and could get a free cleaning of the carpets in one room. You just never know how the market will deliver value!"

Hi Woodstove,

Congrats on the free gas and cleaning. The way things seem to be going in the States, if you buy the $500 worth of gas now and hold it, it might go up something like 20% by labor day !

You bring up an interesting point that I haven't considered related to arbitrage on the convertibles. There has been a lot of convertible issues over the last few months and I think we even discussed on this board how one could lock in the yield with little money down by shorting the common.

I'm thinking that there has got to be some portion of this new convertible money using this arbitrage (especially in this sour market),
But when the market turns some or even much of this money will probably unwind in search of greater return. Which will add more emphasis to the climbing common prices.

It seems to me, these possible situations might be a very worthwhile place to investigate.

Thanks for nudging my brain with an excellent observation.

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