Note that the highest bid and lowest ask aren't from the same MM, so the spread we, who don't have access to level 2 information, see quoted is really a dynamic between two parties, one representing the high bid and the other the low ask. (That's the way it is now and is probably most of the time.) Thus when the spread changes, it must be much of the time the product of the relative interaction of two MM's, unless one MM has both the best bid and the best ask--I wonder how often, if ever, this does occur. Now that I can seen the lay of land, I realize that the market for LONE stock isn't as competitive as I had imagined. I had an idealization that all of the MM's would have the same approximate bids and asks and that in the normal course of the market's ebb and flow, a MM feeling buy or sell side pressure, would respond by changing his own spread and the others would either go along with the challenge by reacting in kind or else resist it, challenging the maverick to return to the status quo, in much the same way that airlines interact with each other when one initiates a fare war. I notice the lowest spread is by HILL at $.06. The best ask is by three MM's ($.39) and the best bid by SHWD ($.33). I'm not going to bother to calculate the avg. spread, but it is obviously much greater than the spread which is effectively available to us consumers, who can pick and choose from all the bids and asks available to find the best deal or let our brokers do so for us. I had presumed that the brokers with non-competitive spreads, like NAIB (laughingly $.063 to $2.03), wouldn't be doing any business, but I happened to glance at a MM monthly volume summary at the OTC Bulletin Board site (www.otcbb.com) long enought to notice that all of the MM's had reported some volume although most of it was reported by just three or four MM's. Here's a copy of the info:
Monthly Share Volume Report
Select a different report by entering an issue or MPID: Sort By: Report Date:
Issue Market Participant
Volume Issue Symbol
Apr 1999 Mar 1999 Feb 1999 Jan 1999 Dec 1998 Nov 1998 Oct 1998
--------------------------------------------------------------------------------
LONE - LIFEONE INC
Page of 1
April 1999 March 1999 Year-to-Date
Volume Rank % Volume Rank % Volume Rank %
--------------------------------------------------------------------------------
Total Share Volume 2,425,651
--------------------------------------------------------------------------------
NITE
KNIGHT SECURITIES, INC. 754,092 1 31 403,076 2 21 1,974,532 1 27
USCT
USCC TRADING/A DIVISION OF FLEET SECURITIES 654,350 2 26 231,247 4 12 1,336,873 2 18
FRAN
WM. V. FRANKEL & CO., INCORPORATED 282,000 3 11 545,294 1 29 1,014,096 3 14
HRZG
HERZOG, HEINE, GEDULD, INC. 202,450 4 8 247,129 3 13 698,227 5 9
WIEN
WIEN SECURITIES CORP. 121,488 5 5 21,000 10 1 877,737 4 12
SHWD
SHERWOOD SECURITIES CORP. 104,000 6 4 186,080 5 9 373,080 6 5
HILL
HILL THOMPSON MAGID & CO INC 96,600 7 3 69,600 7 3 288,950 7 4
PFSI
PENSON FINANCIAL SERVICES, INC. 90,800 8 3 - - - 90,800 10 1
BACH
BARRON CHASE SECURITIES, INC. 50,971 9 2 51,775 8 2 234,646 8 3
GVRC
GVR COMPANY 25,800 10 1 - - - 49,800 12 <1
MHMY
M. H. MEYERSON & CO., INC. 20,600 11 <1 17,900 11 <1 64,500 11 <1
SHRP
SHARPE CAPITAL, INC. 17,500 12 <1 73,600 6 3 173,100 9 2
SOLA
SOUTHLAND SECURITIES CORPORATION 5,000 13 <1 - - - 5,000 15 <1
--------------------------------------------------------------------------------
Page of 1
|
