NAZZ HOLMES....you found a great piece of information....
Without even realizing it.
I'm very surprised that you actually couldn't pinpoint the source of that trade. You out of all the great philosophers, should have been all over this thing. I'm ashamed of you.. LOL.
Well here's what my make is on this "overtime" event.. The best thing to do Nazz, is to put yourself in the shoes of the people you are trying to figure out. Start thinking like them.
First, just think of what time of the month it is? No not that.
Its the end of the month. When all the market makers need to clean up their trading sheets, meaning they must clear up their short positions. This is more or less a requirement by most clearing firms.
Now lets take this one step further. You are a market maker, who is short maybe 300k shares of stock, anywhere between 80 and 90 cents. The stock was down there for a few days, if you remember; hopefully those were the days of the past. So now, all of a sudden you have got to cover that short. There's only one problem, the stock is no longer 90 cents, nor is it 50 cents, as most of these slimeballs were anticipating, it's now over a buck, way over a buck.
So what do you do, where do you go, who is going to get you out of this jam? Not to worry Market Maker, your buddy Market Maker B is there like a faithful dog. Ok, what now? Well, since you need to clean up your short, and not at a higher price as most of you expect, his buddy SELLS him 250K shares at about the same price he shorted the stock at in the first place (hint, hint, 80cents), and WALLA!!!! no more short. Not only that, he no longer has a LOSS in his account(remember since the stock went up from the short price, and the net result is a loss, that loss is reflected in their net capital, which they can't afford). Hey, how can they do that, you ask?
Well, it's called the old market maker pass the bottle routine. Just think about it. Market Maker A is short 300k shares, his buddy Market Maker B sells him the stock at the price he needs it at(of course, they do it after the close so no one spots it), and he's no longer short, and he satisfies the regulations imposed on him by Nasdaq and his clearing firm. Now what does Market Maker B do, he is now short 300k shares that he sold to Market Maker A. Not to worry, buddy, i'll buy it back from you in a couple of days, and you'll be OK as well. Net Result??? Nothing really changed. The Market Maker who is short, just played Nasdaq and all regulatory authorities like a fiddle. As you can imagine, they all play this tune very well. They are pros at this and they know how to get around the system.
In regards to the other trades after the close, these were all buys. They all traded at the offer, and higher. No secret there, straight forward buying. In fact, i think that Market Maker A went out and bought some stock himself after the close, because Market Maker B couldn't help him out on more than 250k. Also, if you look at the last two trades, these were nothing more than a double print. Part of the reason, we have been seen such crazy volume of late.
Well there it is. My little view on the situation. If you think, its too far fetched, don't underestimate the Market Maker.
Hope you all found this fascinating,
Best regards,
Brodway. |
