Webull Stock Arbitrage: ~$9.34/Share from Mispriced Options — Zero Directional Risk

Hi just wanted to help out others by posting some DD about misplaced stock/warrants.

This is one of the cleanest arbitrage setups available right now. It's probably around \~$9.34 per share with **no directional risk**, and the trade is fully hedged in 20 days time. The market is mispricing Webull warrants, and shorting is now enabled to hedge.

# 🧮 Basic Math (20-day hold, 315% borrow rate)

Net P/L = $14 – \[(borrow rate / 365) × days × short price\]
Borrow cost ≈ (3.15 / 365) × 20 × 27 = \~$4.66
**Net profit ≈ $14 – $4.66 = \~$9.34 per share**

# ⚙️ The Setup

* **Warrant**: BULLZ (Webull Incentive Warrant)
* Price: \~$3
* Strike: $10
* Expiry: 2029
* Exercisable starting **May 10, 2025** (30 days post-business combination on April 10)
* **Stock**: BULL (Webull Class A)
* Price: \~$27

# 💡 The Trade

1. **Buy warrant for $3**
2. **Short stock at $27**
3. **When warrants become exercisable**, use it to buy a share at $10 and deliver to cover short

📈 **Total Spread: $14 per sha**re

Short: +$27
Warrant exercise: –$10
Buy warrant: –$3
**→ Net: $14 gain per share (minus borrow cost)**

# 🛡️ "What about risks?" Here's every counterargument answered:

❓ *“Why not just exercise the warrant right now and sell the stock?”*
→ You can't. **Warrants are exercisable starting May 10, 2025**, per SEC filings.

❓ *“What if they redeem your warrant for $0.01?”*
→ They can’t do that *until* the stock trades **above $18 for 20 out of 30 days**, *and* they issue **30 days’ written notice**. That’s **at least 50+ days from now**, and warrants unlock **before** that redemption window even opens.

❓ *“This sounds too good. What’s the catch?”*
→ The **only real cost is borrow fees** on your short. Even at 315% annualized, a 20-day hold nets \~$9.34 per share. The only way it becomes unprofitable is if CTB spikes to **>1200%+**, which is unlikely short term.

❓ *“Can this go ‘tits up’?”*
→ Only if:

* You can't locate shares to short (easily checkable on your broker)
* Borrow rates go vertical
* Warrant prices rise too fast before you execute

But with proper sizing, short locate, and 20-day horizon, it’s mechanically sound.

# 🏦 Why It Works

* **Stock: $27**
* **Strike: $10**
* **Warrant: $3** → Intrinsic value = $17, current warrant price = $3 → Spread = $14

You’re buying $17 in value for $3. If nothing changes, you profit. If the warrant reprices higher or stock dips, you’re still neutral because you’re short.

# 🔁 TL;DR

* **Setup**: Long warrant / short stock
* **Directional risk**: Zero
* **Arbitrage spread**: \~$14
* **Net return**: \~$9.34 per share (after 315% borrow over 20 days)
* **Only risk**: Carry cost and CTB spike

**Positions**: $40K+ long BULLZ warrants, short BULL stock. Hedged, neutral, collecting the arbitrage while the market is mispricing.