Amarin Corp Plc (AMRN)

[amarinbullfromchicago]

I have a friend who’s an activist at a large hedge fund (meaning their strategy is to buy 5-10% of a company and get on the board of directors and impose what they think will help the company appreciate).

The companies he’s buying are blue chip, 100-200bil companies, and they acquire slowly, over weeks. He estimates him buying 3-5% of a large, highly liquid company (S&P 500 sized) usually moves the stock 5-8%. For a company like amarin, buying 3-5% would probably move us 12%+, and trying to buy over 10% would cause us to add 50% in a day. We don’t have enough large players playing both sides consistently to provide that liquidity. Remember, most shares you buy or sell are going to a market maker, and he’s trying to lay off the risk elsewhere. After a certain point they turn around and hack their position and stop providing liquidity one way, and that’s when you see the massive moves.