if a warrant is considerably lower than the underlying movie stock then is nt there a possible arbitrage ? i.e i see a movie warrant strike at 300 costing 8 bucks underlying is trading at 345....cant one sell the underlying and buy the warrant, locking in the profit ? how can this be possible on the HSX exchange ? i have found a few cases so far, so im thinking i must be wrong ? can somebody explain.......i realise there is a time issue but this seems to be in my favour ? warrant finishes labour day in sep and the movie cashes out 4 weeks time.
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thanks