Thread,
May as well continue thinking aloud.
Does anyone have any comment on whether they think the MMs have contributed to the current price level of the stock?
I do not have a propensity to give much weight to MM involvement; however, during MRVC's recent slide it has occurred to me more than once. Many down days were on very light volume. Also, support levels were taken out with very little "resistance". It also appeared that MM's were taking out the stops at times.
Many months ago an article was published in Forbes which referred to a scholarly study of the NAZ in which the authors concluded that on average only 47% of the shares actually traded were between investors, the rest was MM activity. So, take one half the reported volume, multiply by 47%, and you have the number of shares traded between investors. Sometimes, three transactions were taking place to trade one share. ...In MRVC, it never appeared that institutions were dumping the stock.
One incident is referred to where the CEO wondered why the stock moved down 1 point on 10,000 shares but it took 100,000 shares to move up 1 point. Consequently, some CEO's attempted to investigate the trading of their stock, and after viewing the MM's practices moved their stock to the NYSE or the AMEX. Has MRVC ever made any comment on MMs in MRVC; has Noam ever been questioned on this matter? Perhaps, the MM activity has contributed to getting this stock where it is, which has then resulted in all manner of speculation as to the cause of the price action.
Comments anyone?
jc
(I have a copy of the Forbes article printed from the online edition. Sorry, no link. But if anyone is interested I will try to assist you in finding the article and the scholarly article referred to.)
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