[mosta]

I'm not sure exactly what you're asking and don't mean to tell you what you know, but: takeover stocks generally trade under the takeout price due to the possibility that the deal will fall through at some point (typically, regulatory approval and shareholder vote). In fact you can take the spread, discount it, and calculate a "percent chance" that the deal will hold up. Betting that the deal will go through is risk arbitrage. You can be assured that there are many big players constantly watching the exact size of the spread and trading it actively. If you want to get in the game, go for it and good luck. PS/BTW there are some deals where the target stock trades above the takeover price because the deal is one that will normally involve some extra juice at the back end, as good will. I don't know when and why this happens or doesn't happen, but TYC reacquring CIT was one example.