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Biotech / Medical : ACMI - Accumed Inc. -- Ignore unavailable to you. Want to Upgrade?

To: Cisco who wrote (486)	11/10/1997 11:27:00 AM
From: Frank Buck	Read Replies (1) \| Respond to of 1894

Cisco Obviously, someone has been willing to drop the stock price by about 33% in about a month. Quite a haircut on top of the additional downtrend that has been occuring. If the volume is indicative of "churn", we have an obstacle to overcome. The marketmakers have accumulated a significant number of shares. As such they now possess a substantial base of stock that will be disposed of at a time when it is profitable. This can disrupt any attempts to increase the stock-price by retail purchasers. It has always been my understanding that marketmakers were supposed to "buy" shares when an imbalance (shortage) occurs in buyers. In response to your question, I would have to say that marketmakers have to be involved in a significant amount of the daily volume. My reasoning is that without any significant news from the Company the normal buyer volume must be significantly reduced. For any shareholder who is not a trader in this issue, the disposal of their stock at a time when the outlook for the company is "supposed" to be the brighest suggests a change in their "future outlook" for the company. This coupled with the recent insider 144 filings suggests that a base is being built by marketmakers at the current price level. The larger the base, the longer it will take to escape the built base of stock that the market makers have been accumulating. On the other side of the coin, the base suggests that future errosion of the stock price below these levels will not occur without a "substantial" negative event. The impact of the various marketmakers at his point will be a function of; the quantity of stock they control and the level of value each associate with the holding of those shares. Also it goes without saying the level of collusion (If any) amongst them. Here is a cut and paste of an excerpt of an article from, The SmallCap Investor. It illuminates some of the responsibilities of the market makers. Bill Rini October 25, 1995 The NASDAQ market is an interdealer market represented by over 600 securities dealers trading more than 15,000 different issues. Unlike the NYSE, the NASDAQ market does not operate as an auction market. Instead, market makers compete against each other to post the best bid/ask prices. Market makers are required to provide continuous two-sided quotations (ie a bid and an ask), be able and willing to execute a trade for at least a normal trading unit (usually 1000 shares), file monthly trading data to the NASD, as well as submit daily volume reports. The brokerage firm can handle customer orders either as a broker or as a dealer/principal. When the brokerage acts as a broker, it simply arranges the trade between buyer and seller, and charges a commission for it's services. When the brokerage acts as a dealer/principal, it is either buying or selling from it's own account (to or from the customer), or acting as a market maker. The customer is charged either a mark-up or a mark-down, depending on whether they are buying or selling. ***END*** Do you know how many marketmakers the ACMI stock has? The NASDAQ National Market and the NASDAQ SmallCap Market has some new listing requirements effective February 1998. According to NASDAQ, several hundred Nasdaq SmallCap companies could be delisted for non-compliance of the new rules. The requirements have also mandated changes in the numbers of marketmakers for new and existing markets. The new requirements can be found on the NASDAQ site. Frank