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Investing Glossary:
Hedged tender
Copyright 2009,
Campbell R. Harvey. All Rights Reserved.
Do not reproduce without explicit permission.
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| Definition: |
| An Investor sells a portion of a Stock holding Short a tender Offer in the event all Shares tendered are not accepted. For example, investor Q has 5000 shares of XYZ. An acquiring Company makes a Tender offer of $100 a share when the shares are currently worth $80. Investor Q short-sells 2500 shares after the announcement and the price of the stock has approached $100. Company XYZ purchases only 2500 of the original shares at $100. Investor Q has sold all shares at $100 even as the price of the stock drops On a post-news dip.
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