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That seems a reasonable guess.
Controlled selling would mean trying to keep to less than 10% of volume. If you believe he started selling nwbo 6/3 when WEIF was restricted, then 10% of volume would be about 4.2m sold.
WEIF held over 18m nwbo shares (of 24.8m total at Woodford). At that pace and current levels of volume, he should be done selling by next spring.
There is no public information corroborating that 100% of Equity Income investors have requested redemptions.
Woodford has other funds. Whether those are enough AUM to continue in business remains to be seen.
I agree that there is severe reputational damage. In light of that, it is hard to see any institutional investors getting involved. Some individuals like to buy distressed assets at prices they believe do not reflect full value.
Your statements are not accurate.
Woodford's Equity Income Fund has suspended redemptions.
While it may close in the future, it is incorrect to say that has already happened.
Woodford is not being "forcibly liquidated". He is choosing what to sell, and not being forced to sell nwbo.
Woodford has suspended redemptions on the Equity Income Fund. That is not a forced liquidation, although clearly they are selling a lot to raise cash.
https://woodfordfunds.com/words/blog/fund-suspension-extension-29-july-2019/#main
There is currently no way to know if Woodford is selling. Anyone telling you otherwise is just guessing.
1) When nwbo downlisted from Nasdaq, it was removed from the 13-F list, so no SEC filings required on that front.
2) Woodford has been diluted below 5% ownership, so no requirement for SEC filings there.
3) Woodford has changed his own website to top 10 holdings for each fund rather than full holdings, so no longer any info about nwbo there.
In summary, no one will know until months after the fact when UK regulatory filings include full holdings.
There are multiple problems with that post.
First, there is no way to verify that Woodford has sold any nwbo.
For arguments sake, let's say that he started selling nwbo on the day his fund cut off redemptions, 6/3/19. Further assume that he sticks to standard institutional practice of being no more than 10% of daily volume.
Since 6/3, nwbo has traded about 42m shares (rough approx). That would mean that Woodford could have sold about 4.2m. Since he started with 24.8m overall, by reasonable analysis he would be less than 20% done if he is selling the entire position. If you limit the selling to the 18m or so in Equity Income, still less than 25% done.
Don't be surprised if there is an NT filing, then the 10-Q following week.
nwbo has filed NT 7 of the 10 quarters since the start of 2017.
Thank you for posting the timeline. That should make it clear to any reader that there was no time for peer review or revisions.
So you believe nothing would have played out differently if nwbo's article was in NEJM?
I disagree. Publication in a top journal would have given nwbo credibility and visibility it now lacks. The stock price would be higher and funding more readily available, and at better terms.
If Woodford sells any nwbo, it will not be known for months after the fact.
Woodford now only shows the top 10 holdings for each fund on his website. Full holdings will only be available with regulatory filings.
Woodford has been diluted below 5%, so not need to disclose on that point.
Once nwbo downlisted from NASDAQ, it was removed from the 13-F list. There is no need to include it in 13-F filings.
out all day - did not see anything about SAP on SEC site, company website, or PRNews. No indication of news in the stock price.
So was the SAP story just an unfounded twitter rumor?
I certainly agree that getting paper certificates for nwbo is a dumb idea, a lot of expense and hassle for zero benefit. Percent of float borrowed is tiny. Even if you believe the naked shorting story, they wouldn’t be borrowing at all.
Some brokers are better than others at dealing with paper certificates. When I had paper shares for a UK ordinary, Schwab was baffled, while Fidelity handled it seamlessly.
Always look for primary source documents whenever possible. In this case, that means the SEC website where the prospectus was filed.
https://www.sec.gov/Archives/edgar/data/1072379/000114420419034974/tv525349_424b5.htm
@Senti,
Wash sale rules apply if the sale was at a loss. All that does is roll the loss into the new position. The tax loss does not disappear, only deferred.
Wash sale regs would not discourage someone from selling at 25 cents to rebuy at 23. That's a desirable trade whether the existing position is a gain or loss.
Consider the recent 1m share trade being discussed. 2 cents per share is effectively $20,000 profit in a week. Not implying any certainty they are connected - just an example.
Selling shares you own, then replacing them from a secondary offering is okay.
Shorting in front of a secondary and covering with shares purchased in that secondary is not legal. Rule 105 violation. See this link for an example the SEC pursued.
https://www.sec.gov/litigation/admin/2011/34-64839.pdf
Looking a few days after the fact, it appears the 7/11 volume spike was right at the end of the day. The simple explanation is a "market on close" order rather than anything nefarious.
If the q1 burn rate continues, the Sawston money does not last through year end.
Woodford fund suspension extended another 28 days.
https://woodfordfunds.com/words/blog/fund-suspension-extension/#main
This is easy. nwbo is in the illiquid bucket.
nwbo trades a bit over 1m shares on an average day. An institutional investor might target 10% participation. That means a realistic goal would be selling 500,000 shares in a week.
Woodford's Equity Income Fund owns over 18m shares.
You feel the shorts are blamed wrongly? Really? Why would that be?
Hope you don't mind if I take a shot at this one.
I'm often accused of being a short. Never the case.
I've been accused of being part of a wolfpack. Not true, and reinforces my belief that the whole wolfpack notion is silly.
I've been accused of being AF. Definitely not true, and I have hair.
I've been accused of using multiple IDs. Not true, and I'm one of very few using my real name.
From my perspective, that's a whole lot of irrationality.
There must have been some wild assumptions to conjure up a 31 year liquidation estimate for a fund only a couple of years old. Makes me doubt the validity of any of the "analysis".
I kind of miss the sensationalism of the UK financial press from my time in London. Always something amusing.
Do you realize the movie "10" came out in 1979? It predates nwbo's P3 trial.
Bo Derek is 62. She's almost as old as nwbo ceo Linda Powers.
Early leader for post of the year. Very well said.
I seriously doubt that Woodford has been actively selling, much less selling half a million shares daily.
A large persistent seller would be noticed quickly. Bids would step aside. Price would drop. A price that has not varied more than $0.01 per day for two weeks is not consistent with your hypothesis.
Once woodford is out of the way...
I'm not suggesting that Woodford is selling, but rather trying to add a bit of perspective on your comment.
nwbo average trading volume is about 1.1m shares.
A large seller might try to trade 10% of that, 110,000 shares daily.
Woodford owns 24.8m shares of nwbo.
At 10% of ADV, it would take a year of daily trading for Woodford to sell out completely.
So unless a significant buyer wants to take larger blocks from Woodford, he'll be a shareholder for the foreseeable future.
The MIT Tech Review article was discussed in a thread on iVillage back in March.
https://www.investorvillage.com/mbthread.asp?mb=6543&nhValue=12930&nmValue=12970&dValue=1&tid=19297049&showall=1
Woodford info.
Questions expand to other parties. https://www.ft.com/content/881e616a-8d01-11e9-a1c1-51bf8f989972
Woodford's site now shows only the top 10 holdings for Equity Income rather than the whole portfolio.
Also shows last reported cash as -1.86%
With nwbo's 6th consecutive day of volume below 1m shares, there is no indication of a motivated large seller.
The last two weeks nwbo has traded average and below average volume with stable prices. That is not consistent with a large shareholder like Woodford dumping.
The last trading day with high volume (4.9m shares) was 6/1/19, post-ASCO selling.
Sure, this filing is for Toucan (which means Linda) selling earlier this year.
https://www.sec.gov/Archives/edgar/data/1072379/000114420419003609/xslF345X03/tv511975_4.xml
You should already know that Linda has not always been vigilant about making proper filings, as the SEC noted here.
https://www.sec.gov/Archives/edgar/data/1072379/000000000014057016/filename1.pdf
Now you say "I am not making any such case".
One message back you included "I think I can make a better case".
So naturally I challenged you to make that case, which you totally evaded.
What would restrict NW from trading while not restricting LP? Nothing! There is no such beast.
What info would remain restricted for 3 years. Again, nothing!
GGB, unless you can make a case that there is some mysterious inside info that is material, non-public, and lasts more than 3 years; you can't make any case at all.
It also has to meet the criteria that it would restrict Woodford from trading while not restricting Linda Powers' trading.
Reason for halt? Not material after halt was lifted.
Futility rec? If nwbo doesn't think it is sufficiently material to disclose to shareholders, then it is not sufficiently material to prohibit Woodford from trading.
Mitchell did NOT say Woodford had inside information about nwbo. It was a generic comment as to why they might ever be restricted. Once you interpret that comment erroneously, everything built on that unsound foundation is nonsense.
Have you ever heard of a case where someone was restricted from trading for more than 3 years?
This is one of those cases where a few folks on ihub are so vested in controlling the narrative that every attempt to discuss it rationally gets attacked.
I do not find that argument credible.
If Woodford knew anything that was sufficiently material to restrict trading for over 3 years, then it is 100% certain that nwbo would have an obligation to disclose it to investors. If nwbo has no obligation to disclose, then Woodford has no obligation not to trade.
We also know that Woodford (via Mitchell on blog) has specifically stated that they have signed nothing that would restrict trading.
The issue for Woodford is redemptions. He has more investors who want to cash out of Equity Income than he has cash available to fund those redemptions.
Woodford needs to sell something to raise cash. That is true across all of his positions, nothing specific to nwbo. The question is what to sell.
Equity Income contains some unlisted shares. He already did a deal swapping some of those to PCT (Patient Capital Trust). If he can sell any of the rest, it will likely be at distressed prices.
Some of the fund holdings are larger cap liquid stocks which are easier to sell. However, if he sells only the liquid stocks, the remaining portfolio is unbalanced, illiquid, and tilted toward small cap.
In an ideal world, he'd probably sell an equal slice of the portfolio. The unlisted shares make that difficult.
The arguments against selling nwbo are:
- It is a tiny piece of the fund (0.10%).
- He owns many days of trading volume and could crush the price
- He has held for 3+ years. Whatever reasons he has for holding presumably still apply as there has been little nwbo news.
Finally someone sees the light.
Woodford is in a difficult position. It is possible that he needs to raise 20% or more in cash to fund redemptions. Pretty challenging task given a portfolio with some non-traded shares, illiquid shares, and concentrated positions.
If he sells only the most liquid stocks, he winds up with an imbalanced portfolio that is extremely illiquid.
For untraded shares, he is a distressed seller and unlikely to get decent prices. This also makes it difficult to sell an even slice of the portfolio.
If he tries to do another swap with his PCT (Patient Capital Trust), there are issues. PCT can only take on so much untraded stock given its own constraints, and Equity Income is a larger fund. PCT is trading at a wide discount to NAV partly because the market expects Equity Income to sell the shares it received in the earlier swap deal.
Actually I was both a long-only and hedge fund manager. Took the quant track rather than fundamental. Admitedly most of my investment career was spent on real stocks, not penny biotechs.
Consider who are the owners of the warrants. It's not marzan and his minions. Most of the warrants came from the low priced financings. Remember Ader Bays - folks like them. I don't expect they are influenced by any of the stuff in your post, most of which is the usual vague hope dangled for retail punters.
I don't know the identify of individual buyers or sellers, and neither do you (unless you have traded yourself of course).
You asked who could be selling. I gave you a list of potential sellers. Don't know that anyone in particular sold, and haven't talked to Woodford.
Given the bizarre reply, it is hard to imagine what you were expecting.
There are over 500m shares outstanding, and another half billion in potentially dilutive securities.
The average daily volume is 1.2m shares, which is less than $400,000 per day.
I bet a lot of the holders of 457,000,000 warrants, many with lower strike prices, are willing sellers at current prices.
Neil Woodford is looking to raise some cash.
Shares outstanding rose by 14m between the end of December and end of March. Those are not likely to be long term holders.
Seems like plenty of potential sellers to me.
Thugs? I see a few skeptics. No thugs. No wolfpack.
The person who has done the most to depress the nwbo share price is Linda Powers. Let's review some self inflicted wounds.
- Related-party transactions.
- Horribly dilutive financings.
- Multiple NASDAQ rule violations leading to downlisting.
- Massive share and option grants.
- Ongoing SEC investigation.
Her last share/option grant was for far more shares than what Woodford bought for over $100m.
Even if you believe in a wolfpack, there is no way it could inflict as much damage on nwbo as Linda Powers.
Yes, think Soros was fined about 200k in Hong Kong. Probably means that he irked someone high up in the Communist Party.
Don't think that makes him eligible for the nwbo wolfpack. GBP/Brexit speculation would be more his style.