french flag at unis headquarters, page-79

Hi Peri,

Bot, or Robot trading. Look up Algorithmic or High Frequency Trading. Rather than have people doing stuff they program computers to do the same. Some are placed close to the exchanges on high speed networks and have access to more information than you do, such as the number of short positions, and they dont have conscious, or morals or ego like people do, they just execute their plan.

Since such traders trade pretty much for free, the cost of an individual transaction allows them to also do some things your $20+ dollar minimum in and out cant do, such as play with very small parcels of shares to set the price at key times or to put bids or sells down to make you think the market is one way when its actually different, then to move those bids faster than you can get to them.

Is this bad? Depends on who you are. You have to understand the big players own the game. Look at good announcements where the share price moves on low volume, then look at the difference for similar announcements when the big players want to play. The overriding volume will dictate where the share goes, not retail holders.

How can it be manipulation when it is their game? The rules are whatever they play. Do you think there is a 20 minute delay on most retail accounts to help you? Do you ever wonder why big drops never get queried by the ASX but an 8% increase will? They need you, but just to fund it all for them. Ignore their will at your peril.

And first rule is to work out what the big guys are actually doing. Not what it looks like on the surface.