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Great message Randy, I agree completely, specially the last paragraph.
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message from Randy Tidd on Apr 18 1998 7:14PM EST
People always blame the MM's when the stock price does not move the
direction they want it to -- when the price falls or fails to rise, all
the buyers complain that the MM's are forcing the price down. When the
price moves up, they don't mention the MM's, they say that the company
is awesome, has a brilliant CEO, has a great product, they're great
traders, the stock has formed such-and-such TA pattern, etc. The MM
conspiracy theory is just a rationalization to make someone feel better
when their trade isn't working out.
The scenario you mention with AAPL is interesting, but even if it were
true, what does it matter if someone manipulates the price by 1/2 point,
less than 2%, and for just a few hours? Perhaps if they are controlling
huge amounts of money, they can get a lot of 0.50% - 1.00% profits or
something. I figure plenty of that goes on with people controlling the
spread anyways. But does that really affect us regular investors? Do you
have enough money tied up in hourly or daily trades that this is an
issue? If so, maybe you should try playing craps or roulette instead,
the odds are probably more in your favor.
Warren Buffett is known to make all of his investment decisions based on
the stock prices in the newspaper -- i.e. he only needs the daily
quotes, not by the hour or minute. If you can find someone that became a
multi-billionaire from short-term trading, maybe I'd change my mind, but
all of the successful investors that I know of have a trading time frame
much longer than a few hours or days.
Randy |
