I did hear a comment on AVXL and the results on Bloomberg Radio on SXM.

EB

Potential for assignment often does not occur until well after the market closes;

“ … the actual expiration time is the following Saturday at 11:59 a.m. EST.”

The after market price closed at $11.77, which I was referring to; although true that many buyers put their instructions in before market close, they technically don’t have to for another 20 hours.

EB

Also, I sold a small amount of Dec 2nd calls at 12 late in the day as a test to see if they would be exercised, even though share price was <$12. Half were bought at $12 today, even though last trade was $11.77 -> ? which could be considered bullish for open Monday.

EB

As a Phase 2/x study, tolerance and dosing was included. Intent to treat crossover design.

Placebo -> tolerated -> sham dose increase.
Placebo -> not tolerated -> dropped from study.

30mg (randomized) -> tolerated -> 50mg (blinded)
30mg (randomized or decrease) -> not tolerated -> dropped from study.

50mg (randomized or increase) -> tolerated -> no change.
50mg (randomized or increase from 30mg) -> not tolerated -> decreased to 30mg.

The goal was to get as many non-placebo patients to 50mg, if tolerated (that is how escalated CNS/epilepsy Rx used in real world). This is why you look at the ITT as a composite 30mg, 30mg -> 50mg, 50mg -> 30mg, 50mg combined first and primary. Valid subgroups 30mg, 30mg -> 50mg, 50mg. Low validity subgroup 50mg -> 30mg. Unable to validate - non compliant, dropped from intolerance, co-morbid condition and/or death.

This is why the data patient number is different than entry numbers for placebo, 30mg & 50mg. I checked the math and it adds up exact.

The preferred dosage scenario was also being studied for optimal effect w/ minimal side effects: likely start a patient at 30mg and advance to 50mg if tolerated vs. start a patient at 50mg and decrease to 30mg (and potentially off) if not tolerated.

All of this is standard design. Wall Street folks may not get it, but medical providers do.

EB

It is this simple - say you were measuring a drug’s ability to lower blood pressure.

You would NOT take the blood pressure of all the study participants in each group, sum that number and divide it by the number of participants and compare it by using the same methodology after the intervention/placebo.

Instead, you would measure the change in blood pressure (absolute or %) of each participant and perform a statistical test comparing that change in each group.

When listing entry demographics, you would normally list all initial participants.

When analyzing data, you would only include those that you had both pre- and post- intervention/placebo measurements - anything else is invalid.

That is why entry demographics and study results differ in ANY study that does not retain 100% participation (whether by loss to follow-up, death, exclusion of genetic variants [common in my field], or intolerance of the intervention/placebo), of which almost never occurs.

Entry demographics are included just to show that randomization did not have a statistical bias (outside SD) that might show one group was “different” than the other - all entry demographics here fell easily within SD.

Not to be condescending, but this is all medical stats 101. Now perhaps the presentation could have been clearer, but the numbers are valid as they stand.

Ponder this simple question - if a patient unfortunately died during any study, would it be valid to include their pre- intervention data in your analysis if you did not have their post- analysis data? Well, of course the answer is “no”, unless death itself was a primary outcome measure.

Plain and simple,

EB

He is 100% correct. You do not take the mean of entry and compare to the mean of exit of the entire population. You take the delta for each patient and use that to construct two (curves) and compare the difference of the delta’s with a student t-test.

For example, let’s say you wanted to measure the individual effect of changing the pressure in a football in the NFL and had 1/2 the teams changed and 1/2 unchanged. You would not compare the summation average number of throwing yards per QB before to the summation average yards per QB after in each group - you would look at the delta (change) per QB in each group, draw statistical curves (mean, SD, variance) and then compare those two populations.

That is how population studies on Rx effect are done.

EB

So the buyer actually has through Saturday noon to decide if they wish to be exercised (buy the writer’s stock at $12/share), but it is not “automatic” unless the buyers gives instructions. In a stock moving like this, they might even be exercised at less than $12, with buyer taking a gamble that there will be a rise well above $12 Monday AM, getting 20 hours of “news” to decide. I have had my shares exercised at -20 cents before on M & A or spreading news speculation.

EB

New Buy recommendation from analyst with actual positive record in this bear market - $80/share.

https://www.tipranks.com/news/blurbs/anavex-life-sciences-avxl-receives-a-buy-from-jonestrading

EB

Hope link works…

https://stocks.apple.com/ARRc3kQikQR2kpHP8AVapoA

EB

By the way, entry characteristics and result characteristics do not match unless you do not lose any patients during your study (to death, non-compliance, side effects, voluntary, etc.) - which is a rarity. Normally, entry characteristics are included only as demographic data, but entry testing results are not included in a study for all participants - just those that completed the study used in statistical result analysis. That likely explains any discrepancy.

EB

Let’s not forget that as an intent to treat trial (ITT), a medication is often used as it is anticipated to be used in clinical practice. Almost on a daily basis, there countless meds used that are adjusted higher/lower (and sometimes back again) or even stopped because of tolerance issues, whether perceived or real - even sometimes placebos are stopped, as was the case in this study also. When dealing with an irreversible disease in which the family may only have a “limited” time to reduce (not reverse) the effects of the disease, those (titration) parameters are often written into the IRB protocol. Likely look no further than the new wave of adjunct meds with cancer treatments that only give a patient 3-12 more months of life (albeit with tremendous side effects) vs. placebo with studies done on an ITT basis; they were never intended to cure the cancer, just mitigate/slow down the rapidity of its progression. And the data of those trials taking titration based on side effects was likely much less impressive than this.

EB

Level II bid 20, ask 21 - of course only 50 shares either way. Will be interesting to see after it opens.

EB

Level II bid 10.40, ask 12.

EB

Not sure why everyone is hung up on p<0.025 when p<0.05 has been standard in medical research literature since before I was an overwhelmed medical student.

EB

Level II bid 15, ask 16 on TD Ameritrade.

EB

Sorry for phat finger double-tap.

EB

As a physician who reads and evaluates abstracts every day, I can’t imagine (realistically) better results.

EB

While waiting for the billion dollar question, the 100 billion dollar question entered my mind; what if the same agonist mechanism of action improves Neuro-cognitive function from just plain old aging also? Heck, if the infomercial snake oil draws hundreds of millions in sales, what would the real thing do?

Still hoping to get exercised at $20 on Dec 16th, but still glad I sold the calls at $3+

EB

Perhaps follow the option's action to see what is really going might happen.

Buying a Dec 2nd @ $20/share Calls is $0.85 with break even of $20.85 / $9.10 infers a 129% gain in just 4 days.
Selling for $0.85 with share price at $9.10 infers a 9.3% gain in 4 days = 485% annualized gain.
Current open interest is 1581, which means 158,100 shares alone are in play at this single strike price which represents almost $1.5M at just this single date and single strike price.

So is all that just "stupid" money - meaning I could sell those options for a 9.3% 4-day gain, so far out of the money (that is just the bid, as price would more likely be $0.90 = 9.8% 4-day gain = 514% annualized gain) and have as many takers as I wanted, or is it actually "smart" money leveraging a huge gain against my modest gain?

Either way is nothing but bullish with those kind of premiums, or big money that buys my covered calls is extremely "stupid" with millions of dollars (remember, this is just one strike at one date). I doubt that they are and are just taking advantage of my conservatism.

EB

Dec 16 $20 calls still selling for $2.25 (!) - market buyers betting that price will almost double from today’s price in just 4 weeks. My average sell price was $3.05 -> more than happy to get exercised!

EB

“This is another one that I kind of like, I’ve got to tell you. ... I do not like losses in tech, but in biotech I can accept the fact that they have a good pipeline.”

https://www.cnbc.com/2022/11/14/cramers-lightning-round-plug-power-must-get-expenses-under-control.html

EB

Could not pass up selling more Dec 16 calls w/ strike 20 @ $3.10, bringing my net share cost to $0.12 (couldn’t get it down to zero). More than happy to get exercised out and root for everyone else if stock price >$23 in 35 days. Using covered call writing as my long term strategy, I could not pass up the 224% annualized gain (625% if I get exercised) in the calls alone. Rooting for my “loss” >$23 !

EB

When/if it becomes approved, you will find it used for compassionate Rx while off label for many indications - likely not covered by insurance but in some cases, families are so desperate for anything that might help that does have at least some proof-of-modality (i.e. Rett’s, Fragile-X, uncontrolled epilepsy, rapidly progressing Neuro degenerative diseases), that they will not wait while those terrible diseases take their toll.

Not how I like to practice medicine, but where I work there are actually only a handful of meds actually approved for my patients.

EB

50d SMA x 200d SMA

According to the chart on my brokerage account, if we hold near $12.15 at close, 50 day SMA will have met 200 day SMA; will have to wait until tomorrow to see if it is official. Anyone see it differently on their charting software?

EB

Did I miss role of Ariana Pharma?

https://www.arianapharma.com/ai-driven-analysis-of-parkinsons-disease-dementia-clinical-trial-reveals-potential-molecular-mechanism-of-blarcamesine-anavex2-73-in-restoring-key-neurodegenerative-pathways/

EB

Even less if you set p < 0.05, standard for most medical studies.

EB

If I could guarantee that at this moment in time, Dec 16 @ 20 gets exercised for net of $22.50 (w/ premium) with net cost basis of $3/share, I would take it in a second, have no regrets, and congrats to all who stayed in longer for more - with respect to those 1/2 of my shares. Better yet, they are Roth and I am fast approaching 59.5

EB

Only about 1/2 my shares call written; but smart money buying my calls to break even at $22.50? Hard to believe.

EB

65 day MA almost ready to pass 200 day MA - last time that happened was over 3 years ago at $2.50+/-

Sold Dec 16 calls at 20 for $2.50 each (20% premium = 160% annualized). The trade was made in seconds - whoever bought them needs price to be $22.50 in just 45 days to break even; there are some bulls somewhere out there!

EB

Unless the positions were closed (buying back written calls (bullish) -or- selling purchased calls (bearish). I have been writing covered calls in AVXL for years. When the stock drops in price, I often buy back my calls and the sell calls again either longer, at a decreased target price, or both.

Brains at (BWAY) is the only other company I know.

My son is an rTMS tech and tells me flat out that it works.

EB

Hello to all - still own AVXL since my last 2019 post!

It has been awhile since I have posted, but I have kept my long term AVXL positions including adding some into Roth IRA (growth w/o pesky capital gains!). I pretty much had continued doing the same thing month after month after month for all this time. Selling covered calls spilt 50/50 between the next two levels (2.50 & 5, then 5 & 7.5, and finally 7.5 & 10) netting around 8% per month plus any stock price increase. Sometimes I have been exercised out and just had to wait a few days to weeks to get back in below that price (and sell calls again). Well, if we stay >10 on 2/19, I guess I will finally be totally out. Many had asked about this strategy the past, which had netted me about 4X gain over less than 2 years using a conservative strategy. There was always the "risk" of missing out on the big run-up, which it looks like I may have. Still there are worse things than originally buying in at the $2.40 days, slowing adding using the gains from selling the calls to buy more stock and sell even more calls the next month - the power of compounding, and getting exercised at at average of $8.75

I wanted to stay congrats to all of you who held in there for the long run to be finally rewarded. I hope you all sold a little at >$25 and now are playing with the house's money. I expect a buyout comes after the next favorable study or two. The market is too big for AVXL to go it alone if Alz/Park indications come on line and AVXL may be too small to co-partner. I would look towards an older name with a complementary pipeline.

Again - congrats to the long terms on the rise. If I get exercised, I will be back in at <$10. The disciplined strategy I started 3 years ago with AVXL has worked well.

Pigs get fat and Hogs get slaughtered.

EB

50% June 21 2.50 Sold @ $1.20 will be exercised.
50% June 21 5.00 Sold @ $0.15 expires.

July 5.00 Bid $0.15 - might wait a day or two before planning a strategy. If a Mon/Tue drop, will reload the exercised cash back into AVXL, wait for a rebound and sell 2.50 Calls again. If rises, hopefully will get $0.20 for July 5.00, if not $0.15 yields 52% annualized. (hard to pass up with the additional profit of $1.60 if I miss a "big" event that drives it past 5.00 in one month.

EB

Plan on recycling my money right back into AVXL after my options expire. Sold 1/2 at 6/21 2.50 for 1.20 locking in 3.70 & the other 1/2 another capital pay down of 6/21 5.00 at 0.22

Hopefully I will get a bargain!

EB

Well, I guess they are buying the insurance from me then; I still don't buy the short insurance argument entirely - the math may make sense when the strike prices are only fractions of the underlying stock (i.e. RDFN is at 17 and offers strikes at $1 intervals, so the next price up is just 5% above current stock price - not sure that it makes sense when the next strike price up ($5) is 45% above.

EB

Jun 21 $5 Call - Sold quickly @ $0.20 while AVXL quote @ $3.55

Buyer anticipates increase in price by +46% to $5.20 to break even by June 21.

My annualized gain $0.20/$3.55 x 52/5 = +59%

Trading covered calls in AVXL for awhile and the "standard" new 1 month $2.50 call for when the stock was $2.50 = $0.15-$0.20; so I am getting the same premium on time value, but I also get to keep $1.45 worth of potential price appreciation.

Again, for those who do not trade in the options market, this is all extremely bullish or insanely speculative. I only sold covered calls on 1/2 my position, waiting to see what pans out this week before making a decision on the other 1/2 next Tuesday.

EB

With the exception of some unlikely event today, my $5 covered calls will expire today and I will be first in line to sell them back @ $0.20 Monday morning. As long as there is a bid on the $5 option > $0.10, I will be taking the "risk". If we close today unchanged, then 0.20/3.50 x 52w/5w = 59% annualized return plus the upside potential of 1.50/3.50 = 43%.

By the way, 5 month option (October) has a $7.50 option bid of $0.25 = 17% annualized return plus you get t keep 4.00/3.50 = 114% in upside potential.

The open interest weighted numeric price for July remains bullish @ $3.88 which is the weighted price in which option traders are willing to part with their shares or buy your shares reflective of their "break even" points. June remains marginally positive @ $3.50 but the open interest on all options is 12X as much for July vs. June.

What this means is whether they are bullish or bearish, the weighted average of all option traders and the break even point they are willing to tolerate believes that AVXL will be @ $3.88 in 7 weeks - which I stood because most stocks carry annualized positive of about 12% while AVXL carries an annualized positive of 93% as of this "static" moment in history, on 5/17/19 before the start of trading with the last closing price of $3.45

EB

True, but with such a big run up and the potential for a short squeeze, why not just offer to buy them outright at the $0.10 bid price? Sure, you lose $0.05 vs. waiting around for a seller but you guarantee cover in case of a mega-squeeze. Also that logic hold true at $2.50 contracts which the offer is barely above the inherent value of the option (difference = to the $5 contract), but the one being squeezed would have to otherwise cover the $1.60 difference in loses. If I was worried, I think for the same "inherent" price differential, I would buy calls at the $2.50 offer rather than risk the nearly 50% run up in 2 days.

Your points are good food for thought,

EB

Yes, all this could be nothing more than the semi-annual pump and dump it seems that AVXL cycles, through, although the stock chart clearly shows higher highs and higher lows over the past 3 cycles - which is a fairly bullish sign.

My point was that you hardly ever see pump and dump spill over into the options market, because as a seller of covered calls, I get to "keep" their money when the stock falls back to its range. It is one thing to hype up a stock for a short term gain and then dump it when the lemmings follow, it is quite another thing to buy my covered calls and get nothing in return when the stock closes beneath the strike.

My average stock purchase price of AVXL over the past 2 years has been about $2.50 and I has sold calls about every month on 3/4 of my holdings at anywhere from 0.05 (when the stock is 2.25) to 0.28 (when the stock was at 2.55); sometimes I have to eat a little of it back if I want to continue to own the stock but I still make the time value premium (the difference between the option offering price inherent value, i.e. the 0.28 option had an inherent value of 0.05 (2.55-2.50) and a time value of 0.23 (0.28-0.05) when I sold it.

Then last month something funny happened; I started noticing bids for the $5 contract. Eventhough I was losing out on a nice 8% premium for the month when the $2.50 contract had a time value of 0.20, I shifted some of my call selling into the $5 contracts, suspecting that something had changed. As I posted, my 300 contract limit order was snapped up in seconds at $0.15

To answer the other question, yes the price could be reflective of a covered call sale, but for that to be true there must have been a buyer. Just like a stock, when there is an open bid on the $5 option contract for May 17, there is a virtual "barker" out there saying - "hey all owners of AVXKL stock out there, if you give me the right to buy 25,000 shares of your stock for $5 (not the current price of $3.50) for the next two days, I will give you $1250 - and you still get to keep the profit from $1.50 gain on the sale if I chose to exercise my option); or in the case of the June 21 ... I will give you $3750... for the next 37 days.

I hope that diatribe answers the questions I have been getting messaged and happy to answer them. I once was new to the option market. Don't forget you can sell covered calls in your IRA! A great way to earn non-taxable income!

EB

Again, hard to believe - 250 contract bid of May 17 option $5 @ 0.05

This contract almost never has a bid 30 days from expiration let alone 2 days before expiration.

So someone out there is willing to buy the right to purchase 25,000 shares worth of stock for $1250 on the insight that the stock will be at or above $5.05 (to break even) in just 13 trading hours?

That implies a +$1.60 gain or better yet $0.12 per hour until market close on Friday.

I know not every one out there follows the AVXL option market like I do using a coveted call strategy, but that type of premium % for an out of the money call this short time from strike is outrageous!

It points to a either a huge price explosion in the next two days or a large options buyer who has just plain gone off their rocker and wants to give money away on a 2 day pipe dream.

We will know within a few hours of market opening.

Crazy,

EB