Cytodyn Inc (CYDY)

[Hookmeistr]

Misiu143, there are two types of shorts, the legal shorts and the illegal naked shorts. Although there can most definitely be some pain felt by the legal shorts, I suspect that the REAL PAIN that is hoped for will be left mostly to the illegal naked shorts.

That is a much more involved topic but, in short (no pun intended - maybe) those who did not locate shares to borrow (which are on the record), sold shares that weren't theirs and had zero intent to locate/borrow. There are holes in the system that allow this to occur and are conveniently ignored by regulators and not ignored by the criminals of said illegal activity.

Because about 1 in 1,000 companies on the pinks actually make it to the big time, those who play the illegal short game are typically, fairly safe. Most, BY FAR, do not take the time to truly investigate a company well enough to know what and who they're shorting in and don't really follow along. Typically, they're banking on the odds after only some basic scrutiny. They see what they believe is a good pattern...or formula. They go short and move on. Many times, those same companies, the other 999, go to triple 0 price or flatline and they NEVER have to cover their positions. Every dime they sold shares for which they didn't own and didn't borrow, never have to be covered. They walk away fat and happy with investors' money.

Once in a rare while though, there is a company, like Cytodyn, who has the goods, something real, tangible and has EXTREME value. When a situation like this occurs, it can spell financial hardship for those who are illegally short and remain short due to their hubris. When this happens, and that company gets REVENUE, and I'm talking real true revenue of an impactful nature, that's when you see the opportunity for a short squeeze that can cause some REAL PAIN. This can also occur with a buyout.

Most want to see the truly 'bad entities' get their comeuppance and yes, they'll definitely be hurt but keep in mind that those same 'bad entities' conducting the illegal naked shorts have been doing this a long time and know how to play the game and absorb the massive losses. They know how to make money all the way down and all the way back up, to mitigate their losses. They've also been making money on all the other 999 companies, which again helps them absorb those big losses like they will most likely experience with Cytodyn, in my opinion. When losses like this occur, they typically consider this as the cost of doing business and move on. Sometimes, the losses can be large enough that some of the lesser entities don't survive.

I think Black-Ops can much better explain the finer details of how the illegals are carried out and how they get away with it. That's not an area that I can effectively address. I've studied it and understood it but it's been too long and, frankly, I don't remember the details. What I do know is that it's real and goes mostly unchecked within a corrupt system. Many good and honest companies get taken down or horribly hurt in the process. There are also some lousy companies that get hurt or destroyed as well. I guess you have to take the good with the bad they say. I love though that there's those diamonds in the rough like Cytodyn that occasionally makes them all pay dearly.

I know I'll continue to rest well.