neiln, page-5

At current prices, and using a 68% hedge ratio of short TIM to long TIMPB, there is positive cash flow in the trade in so long as TIM stays above 16 cents. Max return is when TIM=50 cents and return is 80%. There is no loss on the updside. In fact at above ratio, there is a breakeven point at $2.30 but then the trade makes money as the price increases beyond there. If share price doubles to $1.75 say, return drops to 22%.