Hi Chuzz,
We and others covered this recently.
Unless we missed something, the likelihood and the successful accomplishment of MM controlling play to the extent that the will of the market(money flow) is bent to the will of the MM( money expended by MM),to the probable profit for the MM, thus far, has not been "successfully" demonstrated, on this thread, or anywhere else that I know of.
In fact, in the example we were given to work with, presented with initial assumptions and then more conditions and assumptions (favoring the Market Maker), "they" could not, under the conditions postulated, create a profit.
At best, when taken to its final conclusion the "MM" was only able to regain a relatively small portion of the kind of money the "MM had to lay out.
Frankly, when first presented with the problem, I had thought the presenter had a total indefensible position. However, this poster has a good command of "mathematical thinking". I found much merit in his resourcefulness. He taught me something about entertaining an other way to approach a problem.
Now in fairness to this poster, he only attempted to show how this could conceivable be done and did put forth a well constructed hypothetical model.
The problem was that in order to demonstrate "the bending of the Markets will" (my words not his) the Market Maker had to expand a huge sum of money and that expenditure when taken to its conclusion (while I admired the attempt), could not be justified.
Of late, he has not posted on our thread and that is unfortunate. I miss his openness to entertain that which is not readily known, and his willingness to explore, dialogue and discover together.
The Market Maker is in a advantaged position. Most of that is understood and certainly made clearer to me, by Mark Peterson. Mark gives us perhaps the clearest look at what happens "inside" at the point of purchase and sale.
No doubt in my mind the MM is able to realize, in a quicker fashion a situation, where this market has subtle momentum in one direction or an other. The MM has the ability to play that knowledge in a more advantaged way than the general trading public. This would fit in with the natural inclination of MM who plays to the nearest profit point.This is an extremely short term, albeit profitable play, in which the MM has a probable gain and a minimized risk of loss.
No doubt there are other "edges and practices" in addition to that I know of, where the Market Maker can take advantage of certain circumstances.
Thus far, I have not seen any that could be characterized as profitably altering the current price of the stock for any appreciable period of time.
Regards,
QT
At this point looks like we did the MM, Buy and Hold (although you just can't help trotting out the old challenge:), Random Markets, O'Neil etc.
Time for us to break new ground. Think of new and better ways to increase our skills and learn from the new discoveries presented.
Please continue to do "your thing" your postings for the most part (...recipes with out an invitation, not appreciated )are indeed "nuggets". I assume that was said by you, tongue in cheek, and when I repeat your word "nuggets" I don't mean fools gold.
Don't know of any poster who has given me as many insights into the world of fundamental investing as you did, and still do).
10,000 posts? How did you get us to put up with all of that?:) |
