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Technology Stocks : 3Com Corporation (COMS) -- Ignore unavailable to you. Want to Upgrade?

To: victor pan who wrote (19346)	7/17/1998 8:31:00 PM
From: joe	Read Replies (3) \| Respond to of 45548

>>how do the money managers keep the price low? by selling the stocks? they'll have to sell a lot right? and then they buy the stocks back? i dont understand. can you explain how this works? thanks.<< first, a dumb question. When people on the thread talk about an MM - is this a Market Maker or Money Manager? To answer your question...the trading pattern for a few weeks has been 'accumulation' by the money managers or fund managers (there actually could be a difference, but for my explanation it doesn't matter). The 'accumulators', whoever they are, have been buying this stock big time...these have to be the institutional buyers who are buying blocks. Then the periodically stop buying, so that 'weak hands' can sell. The stock ends up going downward when in actuality it's being purchases in blocks action massively. The smaller lots are being scared out of holding the stock, because they don't understand why the price keeps dropping, especially after a good earnings report. The 'weak hands' have slowly been bought out...so selling is drying up little by little. If the 'accumulators' were to just place buy orders randomly, the stock would probably fly up to 35+ in days or maybe hours. Anybody who wants to control this stock is very aware of this point. Look at Wednesday day chart at 12:00pm and see how fast it skyrocketed. Also, look at some charts from last week...I use E*trade charts and the daily ones only go back 5 days.... So, the money managers are not selling. They are buying aggressively, without letting the price zoom up. Poor souls like us are so exasperated,because we don't understand why the stock is dropping, that we are willing to dump this stock as soon as we can..."I swear when COMS gets back to where I bought it at $31, right after a great earnings report, I'm gonna sell this dog. I can't understand how this stock hasn't gone up after a 5+ pt jump after earnings (6/25)." This is what the unknowning investor is saying to himself. Hey, it's friday. I'll come back tomorrow, and see if any of this made sense to anybody. Also, I will read up on options and see if I can understand what you guys were talking about...my brain is fried, time for din din and r&r (no dogs today q.<g>).

To: victor pan who wrote (19346)	7/18/1998 2:19:00 PM
From: Steve Porter	Respond to of 45548

victor, Let me try and explain the following for you: how do the money managers keep the price low? by selling the stocks? they'll have to sell a lot right? and then they buy the stocks back? i dont understand. can you explain how this works? thanks. First, think about how the market trades. A trade of 10 shares has the same effect on the stock price as a trade of 100,000,000. If we are currently trading at 29 and I someone buys 10 shares from me at 28.50 then the ticker says 28.5.. it's that simple. Now no-one trades in 10's.. they usually trade in 100's. Now why would I want to sell 2,000 shares of 3com to keep the price down. Well easy. If I have calls out that are worth more than 2,000 shares is called. You will find MMs usually write one call, while the buy one 1 or 2 price points below it. (if they are doign what they did for coms). So in effect the MMs actually are up shares thanks to their 27.50 calls. The proof the the MMs owned most is that we were so far off of max-pain. Steve