IPIC Message Board - Msg: 2869741

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Biotech / Medical : IPIC

IPIC 0.0001000

0.0%

Nov 28 9:30 AM EST

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To: Pancho Villa who wrote (918)	12/3/1997 6:05:00 PM
From: Pancho Villa	of 1359

Covered half of my short position today at 11 11/16. As you may recall from a previous post this chunk I shorted at 12 1/4. Next I present the rationale for my action. If you are not interested just skip the the next post. I am presenting it as IMO some people may learn something about some of the things you need to worry about when shorting a stock. I covered half of my position because even though I believe the coming earnings announcement* may [will?] pull the price down I am very concerned about the [possible unfounded] risk of having the company spin off its ITRC shares to shareholders [yes, I know Neuro has assured the group this is not going to happen but I still have my doubts. I am not a letter writer I am an investor using real $$$ not monopoly money]. *IMO it ain't gonna be a rosy quarter due to: 1. redux subtantial recall charges, 2. lack of [significant] redux revenue; 3. high transaction costs on the Transcell deal, 4. lawyer fees; 5. last but not least, a possible additional drain in cash from the company buying its own shares...[IMO not a very responsible way using a valuable resource] In any event, I am holding down to half my position which as you may recall I shorted at 13 7/16 as the spin off may not materialize, and even if it were announced [and it were to go unnoticed by the lawyers], this would be a clear indication the company is very concerned about the law suits. Under this scenario, I would have to come up with about 0.1 shares of ITRC for each share of IPIC I am short [This is about $2.25/share which based on todays price]. However this is a risk worth taking as IMO the price will probably then head in right direction [for Pancho]. Pancho PS: recall that as most stuff posted in SI, this is just my humble opinion on actions management may take and it is not based in any facts. To those of you worried about poor Pancho losing money on IPIC please notice that on the "first round" I have made money [a fairly nice annualized return] whitout facing much risk [this short is part of a hedged position] and I still continue to believe that the medium term upside risk is not that great. I guess that unless IPIC was bought on the recent deep most longs [unfortunatelly] are lossing money on this puppy.

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