As annoying and frustrating as it is, I find it surprising that...

As annoying and frustrating as it is, I find it surprising that the IMU share trading since our significant FDA Fast Track Designation announcement, is causing such surprise and angst.

As I have said in a previous post, I believe that the current trading has nothing to do with IMUs current fair value and every thing to do with large funds “playing games", both those minimising the effect of their short sale exposure and other funds looking to enter or increase their holdings at the lowest possible price.

I believe that most serious retail investors, who have closely followed IMU, would have taken full advantage of the ridiculously low prices that were on offer during September and October and if not now fully exposed, near to it.

In less than 2 months between early October and the end of November the “Aggregated Short Sales” (ASS) for IMU doubled from around 4% to almost 8%. This is the highest it has been for years and represented over 550m shares.

In that time the share price climbed from the low 4 cents to a peak of 13/14 cents and since has fallen down to 8 cents back up to 12 and today settled back to 10.

The important thing to note is that the total ASS at this level, is loosing around $5.5m for every 1 cent increase in the UMU share price above their holding price.

Accordingly, they are and will, continue to use every tool that they have available to minimise these losses.

It seems that they already had some success, as the ASS has already fallen from 7.9% to 6.8% in three trading days from the 22nd to 27th November, which means they have covered around 75m shares.

Of course, it’s anyone guess what they now believe the appropriate revised level of ASS is for IMU, in light of our current progress and also, how long it will take for them to achieve this “acceptable” level of exposure.

I don’t believe that we will see a true reflection of the “investment value” of IMU until these games are over - or some more news, that is in fact game changing and blows them and their games out of the water!

Now that would be very gratifying!