soun vs sounw???
$SoundHound AI(SOUN.US$ can someone please explain the difference between $SoundHound AI(SOUN.US$ and $SOUNDHOUND AI INC C/WTS 26/04/2027 (TO PUR COM)(SOUNW.US$ aren't they the same company? why is the one with the w half the price of the other? can I buy it? appreciate any and all insight. thanks in advance! TOTAL newbie here. I mean TOTAL.
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starr67 : the ticker with the "w" is probably the warrant. some company has their stock and also have a stock with a "w" which is their warrant stock. idk what warrant are.
Josh RandolphOP : I'm almost certain that you are correct, the "w" is for warrant. I dug a little bit more and found the following definition at NASDAQ.com:
A security entitling the holder to buy a proportionate amount of stock at some specified future date at a specified price, usually one higher than current market price. Warrants are traded as securities whose price reflects the value of the underlying stock.
sounds interesting but warrant shares won't be a part of my portfolio. I'd probably end up losing them because I forgot the 'sell by date" and allowed them to expire. lol. thank you for responding, I appreciate it.
10baggerbamm : when a company goes public many issue what is called a unit. a unit consists of one share of class a common stock and a warrant. a warrant is a future option that is a way that the company can raise additional money without incurring the cost of an underwriting. at some point in the future as designated it will say one warrant plus X dollars in cash is convertible into one share of common stock.. with the sound hound warrant it's one warrant Plus 11.25 equals a share of common (that's from my memory the exact amount of the cash it might be a few pennies higher or lower so don't beat me up over the penny difference or so) so what this means is there any point in time you the warrant holder could give the company the cash they would get it the company and you would be receiving one share of common stock now nobody in the right mind would convert and pay the company cash of $11 and change when the common stock is trading it barely over $5. if the stock come 2027 is below the strike price of the conversion then all the warrants expire worthless that means zero bid. if it is above that price you will get a notice that you have the right to exercise your warrant and converted to one share of common or you could just sell the warrant which will be a significantly higher price because now the common stock is above $11 in change.
skinnydippi : thanks for asking this question. I was confused about warrants also.
Josh RandolphOP 10baggerbamm: thank you for the explanation, I understand how warrants work and what they are much better now. still, not for me though. that whole expiring worthless phrase kills it for me. that would be exactly what would happen. lol. ill stick with the regular stock for the near and long term future. makes sense though but I have one more question .... if I bought $SOUNDHOUND AI INC C/WTS 26/04/2027 (TO PUR COM) (SOUNW.US)$ at, let's say 2USD, would that give me 1 share of $SoundHound AI (SOUN.US)$ now and the ability to convert or sell the warrant in the future for, whatever the common stock is prices at? I guess I'm asking if I would get one share for me along with a "warrant" share? or is it just one "warrant" share?
Josh RandolphOP Josh RandolphOP: thanks again!
10baggerbamm : the warrant gives you an option at any point in time at your discretion to convert to one share of common if come 2027 April the stock is below I think it's 11:25 the warrant zero bid it will stop trading it's worthless. let's suppose the stock is $10 it wouldn't make sense to pay $11.25 plus one warrant to get one share of stock which in the market is worth $10. so the warrants have a Time value that's associated with them and when that time expires it's either going to be converted because it's in the money if the stock is $15 for example you're going to convert and pay the company for your option to be exercised the 11:25 and again I think that's what the conversion price is and then you get one share of common which in the market is worth $15. so hope that makes sense basically if the stock is less than the cost of your conversion that you have to add it is zero bid it's of no value nobody in the right mind is going to convert it and by the way as I said it stops training on the exchange it's zero bid.