I'm not the tin foil hat type of guy as you all know, although no question there is manipulation and tactics surrounding accumulation, distribution, walking the price with momentum up and down dale etc etc. So many trying to make as much money however they can in this game.
However, there are often special crossings and the reasons are many and varied. Simply from one name to another to take a capital gain/loss in one name and re-set the cost base in another related entity for future upside is a common one. Large holdings are often dealt out by sellers via their broker marrying up with an in house buyer to keep the liquidity from affecting the market price too much. Multiple other reasons of course.
However, liquidity on TSX for WAF is much lowert than the ASX because it is a secondary exchange with less spread of holders and traders than here. Average volume (excluding yesterday) wouldn't be 200,00 per day, many days sub 100,000 shares traded.
How to sell out of a 3-4M share holding when there is a wide spread, no depth and so illiquid that the act of selling moves the price further down and away from you? Arrange a buyer that will take the lot, which unfortunately for illiquid stocks usually means accepting a discount. In this case it looks pretty clear that the only buyer seller could organise wanted a 10%+ type discount... 21c thank you very much! And so the price was walked down by selling some 366,000 shares until the crossing could be done at market price, 3.9M shares traded, and then up the price bounces on bugger all volume (75,000 shares).
Why did this holder want out cheaply? I'd guess that after the share price was 20c CAD late Jan and they keep reading about all the terrorist events they decided discretion was the better part of valour and didn't want a part of this new risk profile BF was throwing at WAF. The recent price rise allowed them the opportunity to then discount the sale price into a willing buyer that was still higher than the 20c low. Simply put, this recent bout of optimism for WAF provided the demand to shift 4M shares on the illiquid TSX.
The market and news outlets are all well and truly over the increased violence and risk in BF and trot out articles almost daily to attract clicks and pay the bills. It's not news to us here and most still holding have done their research and decided the value and reward outweighs the over-stated risk for WAF. Others have and will decide it simply does not fit their risk profile and sell out (either before or after making genuine enquiries about what this means in reality for WAF). This selling out by those who have changed their minds is the major reason the share price dropped so much in Jan. But for every seller there has to be a buyer who's opinion is different and sees opportunity not risk.
Ocam's Razor... the simplest explanation is usually the correct one. Here are two news articles out during the last 24 hours that will keep feeding the fear until news outlets get bored and nothing else material changes (he says hopefully).
(20min delay)
