RE: Avacta website significant shareholders18 May 2020 22:08
My understanding, for what it is worth, is as follows:
Asset management companies are there to make money for their investors. In the examples quoted here, they will have bought a few million shares at around 30p and sold them for around 90p. They have therefore tripled their money. That would be seen as very good business and would also affect their cash flow in a positive way.
An individual investor in here that could have bought shares for 17p just two months ago and sold today would have multiplied their investment seven fold. That is also good business.
The key difference is that the individual investor can decide that whilst a seven fold increase is excellent, there could be an opportunity for a seventy fold increase. That is not the basis on which asset management companies work.
As both an upside and a downside of asset management companies, we all tend to like an RNS that tells us that company A has bought 3% of the shares that we are buying but don't like an RNS that tells us that company B has sold 3% of the shares that we are buying. There are reasons why this is the case but this is what they do.
In summary, individual investors have different horizons to asset management companies but can still buy and sell like they do if they choose to do so.
Like many of the individual investors in here I haven't taken my seven fold increase on the shares I bought two months ago, or the three fold increase on the shares I bought one month ago because there is, in my opinion, an incredible opportunity here that is unlikely to arise again.
As ever with these things, please look into this further if you think there is anything wrong with what I have said.
Enjoy your cake. All the best.
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