economics 101 scratch calculation, page-24

gjcl,

I see that you were not able to respond to my request as it seems you are unable to back your comment with fact.

Just so that all here understand how the share registry gets updated, here is an example:

Say A owns 6 million shares and B owns 4 million shares and that is the complete share registry.

A 6 million
B 4 million
-------------
10 million total on registry

The only transaction for the month is B sells 1 million to A

The registry change is as follows

B off 1 million balance 3 million
Broker Nominee on 1 million

The state of the registry is:

A 6 million
B 3 million
Broker Nominee 1 million
------------------------
10 million total on registry

3 days later the following change hits the registry:

A on 1 million balance 7 million
Broker Nominee off 1 million balance 0

The state of the registry is;

A 7 million
B 3 million
Broker Nominee 0
----------------
10 million total on registry

If you looked at the registry movements for the month you would see:

Broker Nominee on 1 million off 1 million balance 0

A on 1 million balance 7 million
B off 1 million balance 3 million

For those that dont understand how the registry gets updated, it seems that the Broker Nominee account has "churned" 1 million shares. That hasnt happenned.

Because the but side is delayed due to t+3 settlement, the 1 million sits in the broker Nominee account before moving to the buyer account A.

Its pretty simple really if you wish to understand it.

The buy side of each transaction is delayed in hitting the registry and has to spend a few days in the Broker Nominee settlement account.

There is no churn in this example. The only transaction was for B to sell 1 million and A to buy 1 million.The broker nominee account just housed the buyers side whilst settlement took place.