Anavex Life Sciences Corp (AVXL)

[Gator328]

Reporting would be for greater than 5%. Lots of investors purposely stay below that threshold for this reason.

As for why the selling, again, I don't think they did sell. But for the sake of argument:

Macro-level analysis would be that despite the positive evidence there is still a lot of risk. Analysts don't get fired for not holding winning positions, they get fired for holding losing ones. Maybe the analyst who bought AVXL decided that it's not worth holding through the trials because of this increased risk -- money can be made from P1 to P3, and it can be made after P3 -- these funds aren't like retail where they want 100-500% gains. Most are content to beat the S&P by a few points. I don't; know Park West's investment strategy so I cannot speak to how aggressively they tend to invest in biotech.

On a micro-level any number of factors could have happened. Maybe the analyst decided that there was too much exposure to Anavex with $12M dollars worth of stock. Maybe the analyst who decided to buy AVXL took a position at another firm and his or her replacement isn't a fan of the company.

Lots of reasons to sell. But again, I don't expect to see a decrease in PW's holdings because I still think there is ample time for the stock to go up in value before the trials conclude and its too late to get out.