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Microcap & Penny Stocks : Diamond Entertainment Corp (Previously DMEC)

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To: Drake who wrote (4092)5/31/1999 9:54:00 PM
From: j g cordes  Read Replies (1) of 6957
 
Don't buy into the notion that all market makers spend their lives shorting stocks.. it ain't so. By law they have to create a market for any stock they represent... it doesn't matter if there's a buyer or seller, they have to let you buy or sell when you say now. They hedge their positions by expanding and contracting spreads, by going long or short to balance their risk exposure. When and if a company's stock starts taking off for solid reasons they'd be the last ones to stand in the way, most of the time they're struggling to balance their accounts by the end of the day. A stock that runs puts them in the position of shorting to provide shares for buyers... because no market maker sits on a huge reserve of shares unless they're nuts. Only the company itself can issue more or take them out of circulation through buybacks.
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