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To: kidl who wrote (2838)	10/23/1998 11:41:00 AM
From: Intrepid1	Respond to of 4201

Great post Kid1, I have long been an opponent of the underhand practice of Jitney trading. On the Winspear thread, Myself and the "Fix" have made a real effort to expose the Jitney trading done by Canaccord. One of the projects I was involved in fell victim to this practice. Why it is allowed is one of life's great mysteries. best wishes purething

To: kidl who wrote (2838)	10/23/1998 11:54:00 AM
From: Savant	Read Replies (1) \| Respond to of 4201

Good article. There are, as it points out, pros and cons. We all know about the "cons" there aren't enough of them. Transparency, does that mean we have to live in glass houses? Or are they talking about the "King's new clothes" <gg> Used to prevent panic and provide an orderly market, it would seem be warranted. Used for underhanded purposes, I am totally opposed. Best, Savant

To: kidl who wrote (2838)	10/23/1998 12:08:00 PM
From: Colin	Read Replies (1) \| Respond to of 4201

Great post Kid1. I had never heard of this. The more I learn, the more I realize how insignificant my investments are. The big guys and fund managers must go nuts when this sort of thing happens. Colin

To: kidl who wrote (2838)	10/23/1998 11:51:00 PM
From: Apex	Respond to of 4201

kid1: Great article !! I just thought that I'd post it on the G&G thread in case it gets deleted oe archived elsewhere by The Globe. ===================== Care of globeandmail.ca and ANDREW WILLIS Jitney trading should be parked STREET MOVES Friday, October 23, 1998 ANDREW WILLIS Maison Placements president John Ing is in hot water at the Toronto Stock Exchange over trading in a junior mining stock. But the case raises an issue that goes beyond the particular allegations faced by Mr. Ing -- the practice of jitney trading, which regulators would be well advised to consign to the dust bin. It is a tactic brokerage houses use when they want to be discreet about their trading, one most investors would never be aware of, although it infuriates institutional clients. Mr. Ing spent two days before a TSE tribunal last week defending himself on charges of manipulating the price of Sonora Gold Corp. -- now known as Sonora Diamond. One afternoon last October, Maison Placements received an order to sell 15,000 shares in Sonora. Rather than do the trade itself, Maison Placements routed the sale through Golden Securities in Vancouver -- a legal technique that's known in the industry as a jitney trade. By the end of the day, Golden Securities had dumped 13,000 Sonora shares and the price of the stock had dropped to 37 cents from 45 cents. The next day, Maison Placements stepped forward and sold $6-million of Sonora shares and warrants at 30 cents each in a private placement. The TSE alleges the sale through Golden Securities was designed to knock back Sonora's share price and pave the way for the private placement. TSE experts say a more realistic price for Sonora is 44 cents. Mr. Ing says he committed no sin; his lawyer argued that the share sale was "inconsistent with any intelligent approach" to market manipulation. The TSE will eventually rule on the particulars of this case. The broader issue here is one investment dealer hiding its trading activity behind the name of another house. However legitimate one might consider the motives, jitney trading goes against the goal of transparency in the market. It should be stopped. If a firm wants to sell shares one day, then try to get investors to buy into the company the next morning, all of its activities should be fully disclosed. Institutional investors hate jitney trading because it clouds the market; fund managers suspect dealers use the practice to pad profits. For example, if a mutual fund indicates it wants 100,000 shares in Royal Bank, and the stock is trading at $66, the dealer might say a block that large is only available at $66.50. Then the dealer could use jitney trades to hide the fact that it assembled the block by purchasing 10,000 share packages at an average cost of $66.20. Dealers use the other side of that scenario to defend jitney trades. Say an imaginary brokerage house agrees to get a mutual fund out of its Royal Bank position by purchasing the fund's 100,000 shares. That shop doesn't want the rest of the Street beating down the price of Royal Bank when it is trying to sell, and may use a jitney trade to hide the fact it is clearing out the position. Here's the counter argument to that point. If a dealer is going to commit its own capital to complete a trade for a client, the price it charges for the service should reflect the risks involved. The TSE is undertaking fundamental changes, all with the goal of increasing market liquidity and transparency for all players. Other regulatory bodies -- the Investment Dealers Association and provincial securities regulators -- worship at the same altar. Putting a stop to jitney trades would send all the right signals about the market's integrity. Normally, failing to break 400 in a day of golf isn't something to brag about. However, it's an impressive round when you're playing 100 holes. To raise $90,000 for the Make-A-Wish Foundation, 40 financial types played marathon golf last week at Glen Eagle golf course, near Bolton, Ont. Tournament organizer David MacNicol, a portfolio manager at Connor Capital, said players were sponsored for every hole they played, with additional money pledged for birdies and eagles, events that became less common as the day wore on. Tee times started at 6:30 a.m. and some participants got in more than six rounds, or 108 holes, before calling it a day. Those who have first-hand knowledge of the Street's cost-cutting drive, or those who dream of being part of the next bull market, may want to circle Nov. 3 on their calendars. Next month, the Toronto Society of Financial Analysts is holding its second annual Career Expo at the downtown Sheraton Hotel. Among the headliners is Harry Marmer of Frank Russell Canada, who will discuss future trends in the investment industry. The mood at this year's half-day session is likely to be a little darker than was seen in the heady fall of 1997. Job cutters, such as CIBC World Markets, are scheduled participants. And John Armitage of Armitage Associates and Stephanie Keeley of Keeley Consulting share the stage to discuss Job Search Strategies: What Employers Are Looking For, at a time when most employers are looking for ways to thin the ranks. Streetwise readers can leave phone messages at (416) 585-5372, or send E-mail to awillis@globeandmail.ca.