thebear37,
Excellent questions. Unfortunately, I can't answer any of them. I would think that emailing Chad and asking him directly might yield the most accurate answer. But I'm sure you've considered that and perhaps have even done so. (Evidently if you did the latter you either didn't like the answer you got, or wanted some "outside" opinions on the matter.)
I don't understand how this stuff works. Yet it is evident that even with the huge selling (almost a million shares traded today) it is being steadily met with strong buying. Yet, clearly, your concern is not whether or not there's enough buyers of these shares, but of not wanting to be a bag holder if these sellers know something all of us buyers don't. Short of selling out before the audits and conference call happens, it seems the best defense is to put in stops in case the audits come out and disappoint.
But back to what these sellers might know. It is of course guess work. But, obviously, the worst thing they could know is that the company is a total fruad. But this seems extremely unlikely given the dividend, the current and previous audits, the fishery PRs, and the recent announcement by the Jordan Fund and a few individuals that they are going to China in a week or so to meet management and tour first hand their facilities and operations. If you agree with this line of reasoning, then it seems the most these sellers could know that we don't is that some segment of the business isn't doing as well as it has been cracked up to be doing. (They could, I suppose, know the results of the '08 & '09 audits. But this seems rather remote don't you think?) Anyway, since these seed investors seem to have made investments in individual segments of SIAF's business rather than all of them, then this would seem to inherently limit the bad information they might know. Why, that is, would a seed investor in one segment of SIAF's business have insider information on another segment that he's never formally gotten involved with? Sure, it's possible. But to my way of thinking, if some of these sellers are selling because they have come across damaging information that people like us don't know anything about, then I doubt it will bad news across the board.
I also think such a mitigated stance on the hypothesis that seed investors are selling becuase they are aware of bad news we aren't gains futher pluasibility when you add in Chad's participation with the company as well as the general trajectory that has unfolded since the end of last year. In terms of Chad, for instance, I have no reason to doubt that he's got a large position, wants the company to do very well, and is genuinely trying to establish himself as a reputable IR guy. Yet all of these goals will come to naught if this is a fruad or fundamentally flawed in some unknown manner. In other words, the secret insider bad news hypothesis either makes Chad a culprit in it all, or has him hoodwinked with the rest of us. Neither of these seems very likely to me. As for the general trajectory of things, despite delays and setbacks, everything that has been announced and talked about as far as I've seen is in basic harmony with the stated goals management laid out in their cc near the beginning of the year, and restated on their website. At the root of that was to get off the pinksheets and make a beeline for getting on a major exchange so they could reap the benefits thereof. Their actions and goals, in other words, are lining up. Moreover, from both a business point of view--raising capital--and a status point of view--gaining the prestige among Chinese peers of having their company trading on a major US exchange--they stand to themselves benefit from pulling it off.
Nothing of course is certain in this or anything else. But I at least feel confident that if we do end up getting some bad news, it will come within the larger context of a legitimate company trying to grow its business.
I don't know if any of this will be of help to you. But I thought your questions were important and wanted to at least think through for myself what the ramifications might be and how, if at all, they'd change my stance on having invested rather substantially (for me) in this company. Hopefully others will chime in with more specific information.
Good luck to all,
Steve
AI
