BBVA Sees Value in Argentina Warrants

BBVA says Argentine GDP warrants are cheap to fair value, “. The government has announced the GDP Warrant Second Coupon Payment, and we take this opportunity to review our views on the instrument and its fair value calculation. This week, the government informed that it would pay 1.32 cents a dollar per 100 GDP Warrants at nominal value. Based on a Monte Carlo model, GDP Warrants in dollars currently trade at a cheap to fair value of $19/$20. The instruments closed yesterday at $13. We are quite confident that GDP Warrants will return to fair value when external market conditions stabilize.