An ‘Opener’ is a movie that’s being released. The release dates can be found in ‘Opening This Week’ or the ‘Release Schedule’ on HSX. Movies open either ‘wide’ or ‘limited’, which is defined by the theatre count (the amount of theatres screening the film). The threshold between limited and wide is 650 theatres, more than that and it’s a wide, less and it’s limited. Wide movies halt and adjust, have OW warrants and have calls and puts. OW’s are Opening Weekend Warrants and every wide opener has one. OW’s cash out at the movie’s weekend gross and as you can buy 100,000 shares in them they represent a good money making opportunity for a fraction of the investment of the actual movie stock. The catch is they halt trading on Friday so you have to trust your gut. Calls and Puts are a little safer as you can only own 20,000 shares in them and they only cost H$2. They still represent a good way to make money for a very small investment. Calls and Puts have a ‘strike price’ (the expected weekend taking) but however much the movie makes in it’s opening weekend there’s money to be made with them. For example, if a movie has a strike price of H$10, it is expected to make $10 million in it’s opening weekend. If it only makes $5 million, the Call will cash out at H$0 and the Put at H$5 (strike price minus weekend box office). You can short them as well as buying them long so in this example you could make H$140,000. Conversely if it were to do better than expected and make $20 million in it’s opening weekend the Call would cash out at H$10 and the Put at H$0.
Movie stocks for openers are not as challenging now as they once were. Movie stocks for openers now don’t halt until Saturday evening (US Pacific Time) so you have plenty of time to see the box office takings from Friday and see if the stock is over or under priced. Opening weekend adjusts now represent easy money. On a Saturday morning simply find the Friday night box office figures for the openers and multiply the Friday taking by 3 for a weekend estimate. Multiply the weekend estimate by 2.7 to obtain the approximate adjust price. Compare your estimate to the current share price and buy the stock appropriately. You’ll see the stock price change accordingly during the day on Saturday as other traders do the same. The movie stocks will then ‘adjust’ (i.e. 2.7 x weekend takings) on Sunday evening.
A wide release movie is ‘active’ on HSX for four weeks from it’s opening date and a limited release movie is ‘active’ for 12 weeks from it’s opening date before it delists.
