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Biotech / Medical : Kosan BioSciences -- KOSN -- Ignore unavailable to you. Want to Upgrade?

To: scaram(o)uche who wrote (31)	8/22/2001 10:09:42 PM
From: Biomaven	Read Replies (1) \| Respond to of 933

Well one explanation for this pattern that I've seen is that someone comes to the MM with a large block to sell (or maybe the MM hears of a big block on the way). The MM doesn't want to accept the whole block outright, and there are no immediate buyers for anything of that size, so he first shorts a bunch, collecting all the buyers he can along the way. This depresses the stock to a point where either more buyers appear or the MM is happy to hold the balance himself for a while, at which point the block crosses. The person really getting screwed is the seller, although of course there is some "collateral damage" along the way. Bottom line is that this is likely to happen in any low liquidity stock with a large seller who is not prepared to wait and dribble the stock out. I suppose the converse might happen with an "urgent" buyer, but I think this is much less likely. Mostly buyers are prepared to be patient and accumulate over time. Peter