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Finance: What is a Special Situation? 0 Views
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Description:
What is a Special Situation? A special situation is a scenario where buyers for a security increase not because of the the company’s fundamentals, but due to perceived opportunity from other circumstances. These can include events such as a forthcoming spinoff, merger, tender offer, a competitor’s impending bankruptcy, litigation, or other outside the norm instance.
- Social Studies / Finance
- Finance / Financial Responsibility
- College and Career / Personal Finance
- Life Skills / Personal Finance
- Finance / Finance Definitions
- Life Skills / Finance Definitions
- Finance / Personal Finance
- Courses / Finance Concepts
- Subjects / Finance and Economics
- Finance and Economics / Terms and Concepts
Transcript
- 00:00
Finance allah shmoop what is a special situation Lebron michael
- 00:09
Either one tiger at least back in the day when
- 00:12
he had hair All special situations Not normal Well investing
- 00:16
has the same anomalies crazy events that aren't predictable in
- 00:19
which offer investors the allure of outsized gains if they're
Full Transcript
- 00:22
smart and lucky and analyzing and taking advantage of the
- 00:25
situation Special situations arise when business events hit a company
- 00:33
which carry enormous weight in the press but really don't
- 00:35
matter to the business itself like you have a headline
- 00:38
of someone finding a fly in their bottle of catch
- 00:41
up The notion is who were the so tons of
- 00:44
bloggers and journalists and tweeters all discuss it Show pictures
- 00:48
of it Talk about the horror the horror And then
- 00:51
there's a vaguely hinted that investigation that a congressman in
- 00:54
a city you've never heard of mumbles to get the
- 00:57
press to notice her And for about twelve hours ketchup
- 01:00
sales of that brand and maybe others dropped by five
- 01:03
percent And that's about it The ketchup company that was
- 01:05
supposed to have a billion dollars in sales this year
- 01:07
will now have only nine hundred ninety nine million nine
- 01:11
hundred eighty two thousand in sales this year Yeah the
- 01:14
flight cost them eighteen grand but their stock Whoa look
- 01:18
what happened It dropped from eighty two dollars a shared
- 01:20
a sixty two dollars a share Almost overnight the crisis
- 01:24
in the press crushed popular sentiment for a few days
- 01:27
and investors in the heat of things like when the
- 01:29
stock was plummeting Would have to figure out if this
- 01:32
fly in the ointment was a one in a million
- 01:34
event or something systemic where we'd find a new fly
- 01:37
in the catch up every other week Or was it
- 01:39
put there by an angry u S Citizen who simply
- 01:42
had something against baseball ketchup apple pie and chevrolet like
- 01:45
Was it sabotage All right well the time to invest
- 01:48
would have been when this situation was special and everyone
- 01:51
was panicking And you kept your head about you while
- 01:54
others were losing theirs Yeah being a smart investor And
- 01:57
you didn't pay attention to any of the noise or
- 02:00
uh
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