Open challenge for 3 and 6 months total returns for the banks that are required to raise capital. Prize money will be given for the winners!
Preliminary rules: Contest starts with stock prices as of close on Tuesday, May 19th. All entries will be due by 6:00 am Eastern Time on Wednesday morning, May 20th. Contestants will be use $100,000 to pick 10 issues. Those issues will consist of the nine banks that are required to raise capital (GMAC doesn't count) plus one "real" bank from the remaining 10 that underwent the stress test. Real bank does NOT include American Express, Capital One, GMAC (previously noted), Goldman Sachs, MetLife, or State Street Bank. Contestants will allocate their $100,000 amoung the 10 banks. However, because diversification is important, no one issue may have a greater allocation (at time of choosing) than 30%. No issue may have less than 3%. Results will be calculated 3 months later. More info later! Add any comments.
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I think you are right on! For example, WFC's new stock offering is at $22/share, which is pretty close to your estimate.
ReplyDeleteIt seems the market is not considering dilution factor. Look at current prices of C,RF,STI as examples.
Builder Rich
Thanks "Builder" - keep checking for our contest details and win some $$.
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