Replies to post #8087 on Cytodyn Inc (CYDY)

[123boom]

Would you know if any warrants are expiring from past cash raising. That would be music to my ears.

[5TOP]

I dont know why there has been so much confusion regarding this. Im half tempted to sticky your post until the misinformation clears up.

To piggy back on your post, I would like to emphasize that these warrants at 0.75 ARE NOT NEW. There aren't a bunch of warrant holders holding 0.75 warrants just waiting on the edge of their seats to exercise them at 0.80 or 0.90 or 1.00. These warrants are old and if you look at the chart you will see the remaining holders have had multiple opportunities to exercise much higher than 1.00, let alone anything lower than that.

Further, how long does it take to exercise these warrants? How long between the day you tell your broker you want to exercise and the day you get your shares? Ive never done this but I dont believe its an immediate transaction. So there is also some risk involved exercising warrants if they are close to their strike price.

[jboatswain]

Saltz is right about the sell pressure.

There are two kinds of investors in microcap biotech. One kind is very long on the companies and will replace the management if things don't go well. But this kind is in minority.

The other kind is not very long. They like to make quick profit because fellow investors follow the same strategy.

They get warrants + shares. They sell shares that are granted to them. After that, they also SHORT shares. Now this puts pressure on SP. At this point, they can take two routes: convert warrants as cover if SP > .75; or buy shares in the open market to cover if SP <= .75.

You can keep your short position open for months, if you want. So, they don't need to go to CYDY for conversion of warrants right away.

The kind of investors that Paulson places shares and warrants are like loan sharks. They don't care about the long term prospects. They also know most of the mini cap biotechs fail. So, they use the trusted strategy of sell shares and keep warrants or sell shares, short shares, then make profit, keep warrants.

This is why, right after private placements, SP of mini biotechs fall right away. Every shark in that group is following the same trick: SELL and SHORT, then keep warrants.

Sometimes, these sharks notice weak companies or companies whose SP < $1, then SHORT till death, and wait for R/S, then cover.