A quick and dirty recap. The Preferreds had a reset period the first 10 trading days in October to recalculate how many shares they would get for the money they loaned GMGC. By forcing (shorting)the stock price lower they get more shares. Public information indicates GMGC short interest increased from about 3.5 million to 4.7 million shares from the middle of September to the middle of October. Now that the Preferreds have locked in a conversion price of about $1.60 per share, versus $4.00 per share prior to the reset date, they get lots more shares for their trouble. An S-3 gets released shortly thereafter in which they register to sell their new found 25,000,000 shares. That indicates to me that they have accomplished their mission and future reset dates diminish in importance. But now they have to sell these shares to get their money.
This week great news occurred. 13,000,000 shares were traded. Imagine what would have happened to the stock price if a big chunk of those shares were not newly created shares dumped on the market by the Preferreds to make a quick 50-100% on their new found gift of shares.
The Preferreds still have shares to get rid of. It will take some additional news to flush them out. Investors who have not researched the history of these Preferred shareholders see a stock that cannot hold any gains on good news. Traders perpetuate the scenario by trading in and out
based on the charts. But GMGC is getting close to ridding themselves of the Preferreds. And when good news continues to occur, new interest in the stock will not be met by Preffereds who need to cash out to move on to other victims.
Those who are short in GMGC have done very well this past year. But I would not want to be one of them once the Conversion game is over, because GMGC is executing, real deals are occuring and revenues will be rising dramatically from current levels.
I look at the current situation to pick at more shares at prices that would never exist if it wasn't for the Preferreds. It is frustrating to see the stock where it is right now. I have lately been attempting to look at GMGC as if it was a private company, meaning, forget the stock price action ( see above for reasons) and focus on the progress, partners and potential getting closer and closer to reality in order to determine whether my investment will pay off in the magnitude I anticipate over the next year or two.
All of this is only in my very humble opinion.
Best of luck to you. Btw, the same Preferreds had previously converted prior financing this past fall and winter.
Seconds Out. |
