NorthWest Biotherapeutics Inc (NWBO)

[biosectinvestor]

Given the investment objectives of his fund, shorting is not likely a primary means of making income. All managers might use hedging to manage risk or to manage timing and pricing challenges when they take certain kinds of risks.

But I doubt he is nakedly shorting any companies in his fund, given its indicated investment objectives.

Naked shorting tends to be at riskier types of investment entities, like specific hedge funds with a defined or undefined focus. Hedge funds are expected to hedge and take those kinds of extreme risks, and given that it's hard to find those without everyone else seeing the same opportunity, I suspect that funds attempt to "manufacture" opportunities by short bashing and shorting biotechs and doing similar sorts of activities with very volatile investments.

If it was openly known they were doing it systematically, which I believe is the case, then the SEC would actually likely view it as illegal activity, which is why, I suspect, it is a highly guarded secret.

However, Woodford appears to have a long-term focus to his fund, and income generation, and while some hedging of actually held positions is very possible, naked hedging is likely not an activity they would engage in much or that any regulated fund, for instance, would likely do if that was not within their defined investment objectives as a key part of their strategy.

However, given the size of his position, I would not necessarily assume he never hedges or tries to make-up for any potential or anticipated ups and downs that could generate income while hedging his actually held investment. And, in that context, one would likely not see a change of total ownership even if he had effectively averaged down using hedging transactions.