InSite Vision Inc. (OTCMKTS:INSV) Explodes Up The Charts

InSite Vision Inc. (OTCMKTS:INSV) Managed to shoot 28.85% on a heavy dollar volume on Friday, after announcing that all of its common stock is to be bought out by QLT Inc. (NASDAQ:QLTI).

Granted, investors had a good reason to be optimistic, as INSV‘s shareholders are to be compensated with QLTI stock when the company gets bought out – which could be seen as a definite improvement, seeing as how INSV‘s achievements to date are far from impressive and its stock isn’t always liquid. Further, it seems like preparations for the acquisition are well under way.

However, perceptive investors would have noticed that one particular catch in INSV‘s press release that specifically stated that INSV “would limit the minimum value payable for each share to $0.25, with a maximum value payable for each share of $0.30”.

This is an excellent anti-dumping provision. However, on the other hand it means that at the end of Friday’s session, investors were buying shares for $0.33 that will at some point in the near future, be converted into QLTI stock at no more than $0.30.

Opportunistic traders that bought INSV as $0.33 will have to work extra hard to make a profit out of that state of developments. Dedicated long-term investors would do well to keep it in mind as well, when they make up their mind about whether or not this is the right time to commit to INSV stock.

Pure hype pushed the ticker further than it was logical and reasonable – so where will INSV go next? We’ll just have to wait and see.