Скачать или смотреть How Wall Street Is Betting on Musk's Twitter Takeover - How Money Works

Hedge Funds are making big bets that Elon Musk will be forced to buy Twitter after all.

There is an investing strategy called M&A arbitrage. Elon Musk offered to buy out Twitter for $54.20 a share. He offered this because it was a funny number and a good enough offer to get the board to agree to sell.

In the year since Twitter has been trading between $50 and $30 which is much more than what most analysts agree the company should be worth.

Twitter should really be trading at around $20 a share, today’s market price represents the probability that Musk will make the purchase he promised to five months ago. The closer to $54.20 the price goes the more certain the market is that he will buy twitter.

Last week the stock was trading at $42 which meant analysts thought there was a 70% chance of the deal going through, after an announcement by Musk that he did want to buy the company after all, the price rose to $49 which meant the analysts now though there was a 90% chance of Musk taking over.

#shorts
-------------

Edited By: Andrew Gonzales

Music Courtesy of: Epidemic Sound

Select Footage Courtesy of: Getty Images

All materials in these videos are for educational purposes only and fall within the guidelines of fair use. No copyright infringement intended. This video does not provide investment or financial advice of any kind.