Ann: Change in substantial holding, page-37

Keeping in mind this is a penny stock - high-volatility, high-risk investment. Keeping in mind you shouldn't have a $ invested in this that you can't afford to lose...

Look at this as a game of statistical edge:

A) On the one hand, what is the likelihood a major holder recently selling ~12% of their shares at an underwhelming price is a signal this investment is not going to succeed?

B) On the other hand, what is the likelihood that this sale carries no long-term signal about the future success of this investment, and the seller just needed/wanted that $500k for something else?

Given WBT SP is down much more than other stocks on a red day because of this news, if Pr(A) > Pr(B), then selling gives a statistical edge. In that scenario, today's drop is just the beginning of more to come But if Pr(A) < Pr(B), then buying gives a statistical edge. Why? Because if Pr(A) < Pr (B) then the odds favour that the SP will AT LEAST return to where it was before this news (minus the average SP drop of all stocks today). There's a 5-6% profit just waiting to be grabbed.

Of course, depending how much momentum there is on the speculation around this announcement, it could drop further yet.

Now, no-one can say for sure whether scenario A or B will apply. But I think any rational-thinking person can see which scenario is more plausible (and more probable). The thing about these decisions is that it can always go against your prediction. Again: don't invest $s you can't afford to lose in specs. But if you're diversifying, like everyone (I hope) knows they should, and you can apply sound reasoning consistently, you should be making money overall.