AIG - American International Group

[mhdousa]

Interesting that the warrants haven't moved at all recently, especially in relation to the common.

 

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[Guest wellmont]

looks like a seller in the warrants who may be putting a premium on liquidity over potential return.

[nkp007]

looks like a seller in the warrants who may be putting a premium on liquidity over potential return.

 

Berkowitz?

[Guest wellmont]

looks like a seller in the warrants who may be putting a premium on liquidity over potential return.

 

Berkowitz?

 

I wouldn't think so given how much he likes it. but who knows.

[nkp007]

looks like a seller in the warrants who may be putting a premium on liquidity over potential return.

 

Berkowitz?

 

I wouldn't think so given how much he likes it. but who knows.

 

He loved Pfizer...until one day BAM!

[Guest wellmont]

looks like a seller in the warrants who may be putting a premium on liquidity over potential return.

 

Berkowitz?

 

I wouldn't think so given how much he likes it. but who knows.

 

He loved Pfizer...until one day BAM!

 

very true. bruce is one of those watch what they do not what they say guys. but I think this is different. pfizer was kind of resting stop for him until he found something in his wheelhouse. and along came AIG and he put a massive amount of his AUM in it. I have a feeling this is a keeper. at least until it starts getting near book value. he might just have a say in how things develop over the years. I think there are some other investors who hold the warrants in size. interesting nonetheless.

[fareastwarriors]

interesting...greenberg owns a good size of the warrants too. he does love his aig

[muscleman]

interesting...greenberg owns a good size of the warrants too. he does love his aig

 

What's this website?

[stahleyp]

interesting...greenberg owns a good size of the warrants too. he does love his aig

 

What's this website?

 

it's from a bloomberg terminal.

[fareastwarriors]

interesting...greenberg owns a good size of the warrants too. he does love his aig

 

What's this website?

 

it's from a bloomberg terminal.

 

i'm sure people on this board own a good chunk of the warrants as well  ;D

[txlaw]

interesting...greenberg owns a good size of the warrants too. he does love his aig

 

What's this website?

 

it's from a bloomberg terminal.

 

i'm sure people on this board own a good chunk of the warrants as well  ;D

 

Damn straight. 

[ERICOPOLY]

Today I bought back a lot of the warrants that I sold for roughly this price in October.  Thanks to whomever is selling these.

 

[plato1976]

In an old Fairholme presentation they estimated the return for this AIG-WT warrant to be 750%

and I believe it's based on Berkowitz purchase price between 8 and 9

So not sure if at today's price 14+ it's still attractive enough :)

 

Today I bought back a lot of the warrants that I sold for roughly this price in October.  Thanks to whomever is selling these.

[berkshiremystery]

Today I bought back a lot of the warrants that I sold for roughly this price in October.  Thanks to whomever is selling these.

 

Eric,..

 

I myself also took a little advantage of the AIG warrant prices in the earlier part of January and increased my already significant position a little ... even despite my earlier purchases had been made at much, much lower prices,... anyway.... I guess it didn't move the needle and my average price much upward. Anyway,... I still have a slight overhang on my major BAC portfolio weightings.

 

I guess you got yours probably at the same prices as mine recently.

 

... do you still keep your focused portfolio weightings in BAC & AIG uneven, thus the same as before.

I thought you always kept some big, big BAC overhang with being "all in" with your portfolio and only nibbling at AIG as a distraction,... or do you occasionally switch them around, adapting,... and take advantage, if one has run up further ahead relative to the other one (i.e.: switching horses back and forth). Consists your AIG position currently only of the warrants or do you also main common and leaps.

 

[ERICOPOLY]

Today I bought back a lot of the warrants that I sold for roughly this price in October.  Thanks to whomever is selling these.

 

Eric,..

 

I myself also took a little advantage of the AIG warrant prices in the earlier part of January and increased my already significant position a little ... even despite my earlier purchases had been made at much, much lower prices,... anyway.... I guess it didn't move the needle and my average price much upward. Anyway,... I still have a slight overhang on my major BAC portfolio weightings.

 

I guess you got yours probably at the same prices as mine recently.

 

... do you still keep your focused portfolio weightings in BAC & AIG uneven, thus the same as before.

I thought you always kept some big, big BAC overhang with being "all in" with your portfolio and only nibbling at AIG as a distraction,... or do you occasionally switch them around, adapting,... and take advantage, if one has run up further ahead relative to the other one (i.e.: switching horses back and forth). Consists your AIG position currently only of the warrants or do you also main common and leaps.

 

As of tonight it is a 7% (of my net worth) AIG position -- dollar value, not notional.  2/3 of it is warrants and 1/3 is options.

 

In October when I sold out of AIG warrants it was a larger position -- I think about 20% of net worth.  I bought back in at pretty much the same price, but took more than 40% gain on the BAC warrants.  So it was a good little trade (the BAC warrants were bought in October after selling AIG warrants).

 

Sure, I have to pay short-term capital gains taxes, but those BAC warrants have the dividend adjustment feature, and that's a taxable dividend.  So the taxes I'll pay on this capital gain is just money I was going to have to pay for that dividend adjustment.  That's how I rationalized the tax hit.

[LC]

Today I bought back a lot of the warrants that I sold for roughly this price in October.  Thanks to whomever is selling these.

I've been buying as well under 14. I think the only person we know isn't selling is Berkowitz.

[Uccmal]

Mostly warrants and 2015 s, with some common and lowlying 2014s.

 

added about 1/3 to the warrant position on the last few days.

 

The warrants are lightly traded.  I find I have to bid close to the ask to get a fill of any quantity.  Not that it matters that much.  I am buying these because they will be worth multiples in the coming years.

[finetrader]

I'm happy with my 19% position in common. Switched my warrant for common too early last september but still happy. The warrants have outperformed the common a big way the past year.

[meiroy]

 

General question: if interest rate rise and the fundamentals of an underlying common do not worsen, does that mean that the implied interest part of the warrant would increase as well? Same for options?

 

[value-is-what-you-get]

 

General question: if interest rate rise and the fundamentals of an underlying common do not worsen, does that mean that the implied interest part of the warrant would increase as well? Same for options?

 

I would say yes to both.  Rising interest rates benefits the insurance company so better results.  Presumably, interest rates would rise to stave off inflation - increasing premiums with decreasing real dollar liabilities.

[meiroy]

 

General question: if interest rate rise and the fundamentals of an underlying common do not worsen, does that mean that the implied interest part of the warrant would increase as well? Same for options?

 

I would say yes to both.  Rising interest rates benefits the insurance company so better results.  Presumably, interest rates would rise to stave off inflation - increasing premiums with decreasing real dollar liabilities.

 

Thanks. So the interest part of the warrant could be a sort of a mini hedge against a temporary drop in AIG's (or the banks) fundamentals due to rising interest rates?

[value-is-what-you-get]

 

General question: if interest rate rise and the fundamentals of an underlying common do not worsen, does that mean that the implied interest part of the warrant would increase as well? Same for options?

 

I would say yes to both.  Rising interest rates benefits the insurance company so better results.  Presumably, interest rates would rise to stave off inflation - increasing premiums with decreasing real dollar liabilities.

 

Thanks. So the interest part of the warrant could be a sort of a mini hedge against a temporary drop in AIG's (or the banks) fundamentals due to rising interest rates?

 

It would, but only imperfectly.  The volatility would probably play a larger role short term unless it was a pretty big rate hike which is unlikely.  The thing is with the warrants - they are so long-dated the models don't work very well.  The greatest hedge against a temporary drop in the fundamentals is that it is trading at half book value and the warrants have a heck of a long time to expiry.  These two factors really eclipse any others to my thinking.

 

 

[meiroy]

Thanks value-is-what-you-get

 

BTW I just figured out how to get correct closing values for options and warrants from Yahoo Finance into Google Docs for anyone who needs it.

 

Here are two examples.

 

For AIG-WT:

 

=Substitute(importXML("http://finance.yahoo.com/q?s=aig-wt&ql=1","//span[@class=time_rtq_ticker]"),"*","")

 

And as an example for AIG Jan 2015 40.000 call:

 

=Substitute(importXML("http://finance.yahoo.com/q?s=AIG150117C00040000","//span[@class=time_rtq_ticker]"),"*","")

 

It works for other warrants and options as well, just put in the correct URL.

 

 

[Liberty]

Thanks value-is-what-you-get

 

BTW I just figured out how to get correct closing values for options and warrants from Yahoo Finance into Google Docs for anyone who needs it.

 

Thanks, that's useful!

[infinitee00]

 

 

Here are two examples.

 

For AIG-WT:

 

=Substitute(importXML("http://finance.yahoo.com/q?s=aig-wt&ql=1","//span[@class=time_rtq_ticker]"),"*","")

 

And as an example for AIG Jan 2015 40.000 call:

 

=Substitute(importXML("http://finance.yahoo.com/q?s=AIG150117C00040000","//span[@class=time_rtq_ticker]"),"*","")

 

It works for other warrants and options as well, just put in the correct URL.

 

Thanks a lot ! I have been trying to figure out the options thing in google drive for quite some time now without any success. I use another method (importdata) to fetch warrant related data but failed to get options related data. Thanks again.