I'm a CPA and have purchased a lot of stock in LLEN at an average of a little more than $2. Unless this is a fraud, I just can't figure out why it drops so quickly after good news over and over again. Who on earth can be selling at these volumes and at these prices? Is anyone able to tell who exactly is selling all these shares and why they would be doing so?
you can't be a CPA asking these questions - the stock dropped following the recent conference call - just read the transcript and you know why
moreover the numbers obviously don't make sense - given the Chinese coal market and the small size of the company's mines it is impossible to operate at a profit currently - but the company still claims to do so.
and look at the recent incidents with regards to the Ironridge transaction involving the CEO and other insider selling
what else do you need
Lets re-wind to the earnings and Say everything the Shorts wanted to hear. LLen has no money. we have no contracts, we have no future, we are bankrupt.LLEN is only make believe, and that is that.Would there have been less contempt, in this bizarre world of LLEN CHINA? would the mad dash for the exits any less traveled?
If look the short positions the last 3 to 4 months have Increased dramatically. From less than a million shares to more than 4million shares. If I assume that this is not hedging in some way and naked shorting then someone must know something we do not. And management also deliver great numbers is not able to shake off the "fraud" feeling that is lingering around the investing community. The last conference call did not help either to dispel this feeling. I understand Mr Lee could have been sick or not feeling well and left the CC however he could have excused him self. People would have understood and would have avoided speculation. The rest of the team Clayton and Ian although with good intentions were not prepared for the CC. The confidence element that Mr Lee provided was missing. If these guys spend 15 min on the BBs they would have known what is on the investor's mind and had prepared accordingly. Right now the best way to shut of the naked shorts is to increase their cash position through a revolving line of credit or at the expense of growth. The iron gate fiasco should not have happened the way it did. They should have known better. Some errors in judgment are ok as executives have at times to deal with many unknowns. But not this one with Irangate. LLEN needs to increase their cash to at least 10%of their book value to get the flexibility they need and keep naked traders at Bay.
I called SEC regarding naked shorting as I believe all investors should know who is behind shorting big amounts of stock, like we do with the long positions. Any investment account owned by an individual or corporation, accumulates more than 5% in position whether short or long should be publicly reported. Their answer was a runaround. Unless this transparency exists we will never know the people behind these transactions. We need to actively go after SEC to report the short transactions by name.
" the short positions the last 3 to 4 months have Increased dramatically"
They have, but it is more a result of being included in two of the Russell Indexes. Many traders, including myself do not short individual stocks, but do short indexes and their related short/long ETFs.
When a company goes long or short the indexes, the index manager adjusts the portfolio to match the holdings. It's not a exact science, but institutions and traders who do not want the risk of trading the individual stock will use the indexes. You will also find a lot of program trading in them...some of them don't do anything but. The vast majority of these so called institutional new holdings of LLEN are based on the institutions purchase of a long position in the Index. Those Index trades generally occur before the open or right at the close. Between the MM and the Index manager. They don't mean much....if anything to a retail trader.
LLEN is not on the "Threshold Security List".
In fact, I don't recall it ever being on it.
If there was a "naked" short issue with LLEN, it would be on the list.
The "runaround" as you called it from the SEC, was probably them trying to explain to you what naked shorting is, and how it is detected. Also why it occurs!
I don't know what gave you the idea that this ticker is compromised by naked shorting. To my knowledge it is not and never has been..
Frankly speaking, there are not enough people interersted in it, short or long...
The stock drops after good news, as there are no long term holders to support the stock. Institutional ownership is non-existent. The float is huge. Traders trade it, and never hold. Pumpers Pump to Dump. Shorts who act as pumpers., to re-short.There should not be options on sub $5 stocks. Algos love LLEN based on volatility. The stock runs up into earnings, and then slides for 45 days after earnings. Clockwork. No insider buys ever. Why would the market place have confidence.
The whys are too numerous to list here, but there is a lot of good DD on this message board...