To think that shorts would short a stock from 4ish down to 2.50ish and then hold or increase their positions especially with a stock that had plenty of news coming, is to me, wrong thinking. As much as I don't care for shorts they, by and large, are not stupid and some are probably very smart.
Don't get me wrong, I know the short interest has increased, but what's the real reason why? To me it's not because "they" think this is a bad stock and will go to zero. They know that is very unlikely.
Nor have they increased their short positions because they think LS will bomb and the stock will crash. They may not believe in LS but they know that even if LS doesn't sell the stock goes down to a buck and some change. They wouldn't put so much of their money into a stock like NAVB with that risk/reward.
They also haven't shorted the stock because they have nothing better to do with their money and want to park it in NAVB just to keep the price down. (I'm talking HF here not the retail shorty) It's also not likely that they shorted this stock and now don't know how to get out of it without driving the price up, this isn't their first rabbit hunt.
So to me there aren't any fundamental reasons for this stock to be shorted especially as heavily as it is, especially at this price . So why are they doing it?
If you're waiting for an answer, I don't have one but I'm sure others do. I'm also sure that others have already stated those positions but they are spread out amongst hundreds or thousands of post that I can't wade through.
So if my arguments above are correct then why are they shorting NAVB? Let's gather those thoughts and theories into one post. Thanks.
NO one exactly knows what the shorts are betting for? how long they are going to be controlling this stock? But the fact of the matter is, they have already finished this stock and who know how below they would take it.
Let's say you're Platinum Montaur, a hedge fund with annual targets to meet and got a nice deal with associated warrants on stock in 2007; the cost basis of the shares you got are extremely low compared to today's prices, so you could short shares and then cover with the extremely cheap shares you got in the deal if some big news or surprise revenues occur. Chances are this won't happen in the near term, and you scare some weak handed non-institutional investors, thereby driving the price down and get to cover on the open market and making some risk free returns. You also get to keep that long position you bought for cheap in 07, it's also an insurance policy for those short trade.
You may be right. I have a couple of questions. You have warrants and cheap shares from 2007. Why make money by shorting it? I'm not saying they can't do what you says and they very well may be doing what you say. But why? Why not just let the price appreciate and make loads of money that way? Is there a strategy or tax benefit that I am not aware of from shorting against shares that you already own? Thanks.
I agree--they do it because they can----and they can because they have more shares they can sell than there are buyers to counter them---i think some hedge fund or two bought huge blocks back 10-20 years ago for pennies and thats why we see such a huge short number----you got to remember they will make a lot more money when they let it run and start selling some of those shares they stole from joe smoe for 2.50 and they sell them for 15.89 a year and a half from now----a level playing feild its not----i feel for manegment myself--this has got to be brutal for them----the science doesnt lie so i sit tight adding when i can----jimmie
Sentiment: Strong Buy
Can you explain that? Are you saying that some HF has nice gains so they are shorting a percentage of the shares they own to protect against any downside? I know that happens and is a smart strategy, that is until you short so many shares to protect yourself from a fall that you have created the thing that they worry about. Don't they?
Because they can. They found a stoick that they can short at will, and manipulate with ease. Its an ATM for them. 1 reason is there is too much retail, not enough insitutional holdings. I think its that simple.
I dont get too caught up in the shorts as I'm a long term holder, and it could last a long time too. My guess is they will stay on this until steady revenue occur.
These are my guesses, as nobody really knows.
Its easy to do with low volume. When revenue starts coming in, new uses added, Sentenel designation approved, etc, other people will start to take note and begin to buy. Only then will the price go up. That wont happen tomorrow, but it WILL happen. Until then, ignore all the BS about the product not being any good or low sales. Those people are either idiots or shorts. Actually i guess thats redundant.