NorthWest Biotherapeutics Inc (NWBO)

[Pyrrhonian]

I think it should surprise and alarm everyone who thoughtlessly throws their hard earned money at a lazy manager who reads off a list of the latest best performing mutual funds (who will then make the list for the worst in the next six months), and puts it all in the top three. They're just after the fees.

Then you take those funds themselves and look at their small team of analysts, who use broad strokes to add or remove a security from their list of many hundreds. Sure, you'll perform at a consistent pace and remove much of the risk, but for every 5 good companies you are invested in, you are also in 3 bad ones.

That's why there are some very select hedge funds out there who only take around 100 clients, and only diversify into 40-60 companies, all very thoroughly vetted. This is proper diversification, imo. The Bogleheads love what I would term "over-diversification," and they can neither see nor do anything about market trends. Neither can they be select in their choices. I don't personally believe that is smart investing, though clearly most disagree with me (including every manager in control of your 401k).

But to be specific, yes, the short interest actually grew from 8 mil to 8.3 mil over the last downturn into the upper $3s. There is no logical way to explain that move, and why the short positions taken up in the $6s didn't cover there. The illogical but likely correct explanation is that the short interest here are not as "smart" as you think. They use broad statistics to determine which companies to short and which not to, and in general these stats will return an overall profit to them. NWBO is a very likely outlier to the left of their profit median, in the loss portion of the curve.

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