I posted this awhile ago. And I know some just see the market as a gambling den.... but the average Mum and Dad have been encouraged to see it as investing.
asteroider,
If you think that the 'borrowed' shorts are problematic, wait till the sh*t hits the fan when ASIC realises that there are (IMHO) massive FTD (failed to deliver) naked shorts in the system. When normal shares are sold they are registered immediately, shorts have a grace period which means it's open to manipulation. There appears to be one set of rules for retailers and another for 'sophisticated investors' (read parasites). ------------------------------------------------- Posted #9430122
ilyas ..it's called shorting and it's meant to be good for...ummm forgot who it's meant to be good for now...was it investors or ASX liquidity. Anyway it's meant to have long term benefits for investing...BS
In reality, if your big enough, on an unlevel playing field with the odds in your favour you can take the price where you want it. In brief it works like this: if you can have multiple accts (which retailers can't) and you can stack the buys and sells sides (which retailers can't) you can get market direction going....trigger some buys or sells at no brokerage (retailers can't) to get it going, then because you have a huge number of shares and/or short shares (which retailers can't) you churn the stock (which retailers can't) and slowly buy up the frustrated or sell to the 'it's gunna go' buyers. You range the SP by say 0.5c...yep that's all you need 0.5c...that stops the DT's because they can't get a profitable trade in because they (retailers) have to pay brokerage. You then XT at half points (which retailers can't do) and pick up or sell off in those places as required because we can see on your screens if they are an Insto or a retailer (which retailers can't do). After a few steps like this many retailers get frustrated and sell out.
Then comes the big hits. With your HFT (which retailers can't do) you measure the market potential and plunge push the price down 3% to 6%(doesn't matter what supply it takes, even if it seems too many shares...which retailers can't do), and hold the SP with churning (which retailers can't do) and slowly buy back the shares (pay back the shorts if that's the case) when adequate are accumulated (it may take a week to get say 5 million on a 100 million churn). Let the SP rise...if it's a positive stock...something that everyone thinks should go up) it won't require much encouragement but a few buys. Then sell into the momentum without killing the rise...use your bots to determine the pressure (which retailers can't do)...could even do up churning to add encouragement as there's no brokerage (which retailers can't do). When adequate is sold (via this range churning), plunge it down to the next step and do another range buy. At each step profit is made....rinse and repeat. For retailers it's Walking Death.
So why crunch the SP, .....well you have to go with the market flow. In this case down. A spin off in down markets is: if you can find a private buyer for the company you could make even more money. If your big enough a 3 to 4 year horizon is nothing. Just push the price low enough to 'force' a takeover and on sell it on.
Looking forward 3 years I see this and many other companies being manipulated into private equity....
However, remember these shorters are only doing what they are ALLOWED to do..our Govt via ASIC has made it legal (imagine what they could be doing that's illegal..like naked shorting...no they wont, would they??...Hello).
Don't blame the HFTs, shorters, etc....blame ASIC for allowing this stupid regulation.
