ARGENT Float 12/15/35

Argentina GDP Warrants

Credit, Macro


Highlights

The presenter sees an asymmetric risk/reward setup with Argentina’s GDP warrants. The warrants were issued in multiple currencies [USD 2x (2005 and 2010), EUR, JPY, and ARS], and the EUR and USD warrants (issued in 2005 and 2010) & presently trade at ~3. These “hybrid” equity/debt investments provide optionality on the Argentine economy. Payments are triggered if GDP growth is higher than the baseline and shows a y/y increase (more than 3%). Volatility will be high, but with ~31 points left on each looking out to 2035, there’s “a lot of intrinsic value” present and three ways to “win.”

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