Anavex Life Sciences Corp (AVXL)

[Gator328]

The most recent run was due to the Russell addition, in my opinion. Funds had to buy as part of the rebalancing. Whether shorts covered as a result is secondary to the fact that AVXL increased its institutional ownership by way of the Russell.

The run in May 2019 was predicated on the news that the Phase 2 AVATAR trial had begun. Notice the timing: the PR was released on May 8th, and that was coincidentally (or not) the day that the run began, though it hit full force a few days later. Again, it is possible and even likely that shorts covered into this news which sent the stock price even higher, but it was a news-driven event that jumpstarted both runs.

Similarly it was a news-driven event, the shelf offering announcement, that led to the selling that we are seeing here today.

There are exceptions, 2015's short attack led by Adam Feuerstein being one of them, but for the most part shorts are a reactionary force. They jump in when they smell smoke and exit when the fire department arrives. In both of the previous two runs, there were news-based events that made shorting unattractive -- or as you correctly said, fundamental changes.