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Microcap & Penny Stocks : FRANKLIN TELECOM (FTEL) -- Ignore unavailable to you. Want to Upgrade?

To: Bill France who wrote (21260)	11/14/1997 10:29:00 AM
From: Seth L.	Read Replies (1) \| Respond to of 41046

Bil do not know if this is right but rb will correct me if I am wrong PLEASE. My theory is in a market where the MMs know will be very active in a certain direction accumulation (buy) or distribution (sell) they widen the spread to prevent what is called a locked or crossed market. On the NASDAQ it is prohibited to create a cross market, I have no idea if this is true with BBs. It works in the following format: 3 MMs have entered quotes for XYZ company MM one 4 3/4 - 5 1/4 MM two 5 1/8 - 5 1/2 MM three 4 7/8 - 5 3/8 A new MM could not enter a bid @ 5 1/4 or higher. A new bid of 5 1/4 would create a locked market since the lowest asked price is also 5 1/4. A new bid of more than more than 5 1/4 would create a crossed market For example a bid of 5 3/8 would allow a trader to buy a stock from MM @ 5 1/4 and sell the stock to the new bid at 5 3/8 this would allow the trader to earn a guaranteed profit. Dont know if it applys here but when we are NASDAQ it will Seth