Stocks and the Xantia

KP · Post by KP » 01 Oct 2008, 11:53

Well its not really french car related but it could be...

Reading the news or HBOS being bought out by LloydsTsb is it possible to buy shares in HBOS and then wait a while for LLoydsTSB shares to settle and be converted from HBOS to LLoydsTSB shares, then sell them to make a profit?

Ie i buy HBOS shares today at about 131.0
Lloyds have said they will convert each HBOS share into 0.83 of a LLoydsTSB share.
I then sell my Lloydstsb shares and this would net me some profit.
Excluded share transaction fees i work out i would make about 60p+ a share.

Is this Illegal or is this how share dealing can work?

Reason i ask is i could buy the shares, make the money on them and then be able to get a garage to fix my xantia for me as i would'nt be skint anymore, and also to buy more baby things and things for the house thats falling to bits....

Xaccers · Post by **Xaccers** » 01 Oct 2008, 13:11

There's a saying on Wall Street.
"It's easy to make a small fortune on the stock market. All you need is a large fortune to start with"

I dabbled a bit with NTL stock before King George (very nice bloke) and his pals swapped stock for the company debt.
If I had a crystal ball, I could have made a fortune.

If .83 of a lloydsTSB stock is greater than a HBOS stock, including fees etc, then yes you could make money.
Course that's assuming just after the merger lloydsTSB stock doesn't plumet in price.

reblack68 · Post by **reblack68** » 01 Oct 2008, 19:46

If what you have described is freely available I imagine the laws of supply and demand will wipe out most, if not all, of the profit. If it's an opportunity for free money there will be a high demand for HBOS shares, driving the price up. There will be a rush to offload the converted shares and this will drive the sale price down.

There is also the possibility of Lloyds TSB going belly-up in the interim.

I would respectfully suggest that somebody who has to ask a question like that may not be ready to get rich quick on the stock market, especially in the current climate. Not that I know anything about it but I do know you'd have to be pretty on the ball to win at the moment.

KP · Post by KP » 02 Oct 2008, 12:59

Cool stuff guys

Just thought i would throw an idea into the mix.

I am starting to think that the way thigns are goind the gov are going to end up owning most of the mortgages or underwriting them in the UK if bailouts continue and we will be left with say 3 or 4 big banks who have bought up all the little ones during this spate of difficulty.

it would be so much easier if money didnt exist

uncle buck · Post by **uncle buck** » 02 Oct 2008, 17:22

You should have bought the HBOS shares yesterday when they were 131 as they closed today at 170....if you had bought a £1000 worth yesterday you could have sold them today & walked away with £297...there would be dealing cost to come of this though.

Be very careful tho as share dealing is a very risky business!