basparks79, I appreciate your articulate, reasoned reply. I have trouble imagining the mechanics of this type of short attack for a not-under-capitalized targeted corporation. Maybe I'll have to live through it personally to "get it."
I saw how it maybe worked in the Dec 1 to Dec 5 timeline last year. AF wrote a hit piece in Stat News and all the negative articles I read after AF's appeared to be based on it. But the Anavex press release statistics were odd and limited (IMO) and I thought the conference call Dec 5 was poorly conducted and unresponsive to the criticisms, so AF and co-conspirators had, unfortunately, an easier target than they should have. I don't see that happening in the face of a peer-reviewed article, but I look forward to finding out (mainly because I'm excited to see the article, but also curious about the market/short response). I would think most large retail investors would read the journal article (which will not be an easy target like the PR and Dec 5 conference were) before dumping their shares based on some hit piece and concurrent short attack. I still believe a positive journal article will kick off a sustained price rise, which will include a lot of short covering. Doubtless you would like to see that, too; you just don't expect it like I do. In time we'll find out whether you get a happy surprise or I get an ugly disappointment!
If they're taking short positions to drive the price down so they can accumulate shares at lower prices, they'd have to own one helluva lot of shares to compensate for the hit they'd take buying back the 18 million shares they shorted. It seems unlikely to me that the short sellers own a huge portion of the float.
As you know, the short interest is a whopping 24%. It was lower than that before the December PR and even two weeks and one month prior to the most recent short-data release. If they were just manipulating the share price, I'd have expected them to cover when the price was in the 7's and 8's in December; but, instead, they added to their short position. It would have made more sense to cover when the price was lower and then short again once the price was substantially higher. But the short interest was rising in the second half of December when the price was pretty much always below $9. Their choosing to do that makes sense to me only if (a) they believe that just with short attacks they can push the share price well below $7 (which I find unreasonable at this point in Anavex's progress) or (b) they believe Anavex is going to fail on the merits. (Since Anavex isn't undercapitalized, their plan can't be to break the company before it releases convincingly good results from bigger trials or gets its first regulatory approval.) I think they're grossly misguided, but the only way I can make sense of the short interest rising these past two months is that they really don't believe in the company's merit.
By what logic do you see the short attackers increasing their position these past two months (especially in the second half of December)? What do you think their endgame is?
