"Why would an insto be bothering with midpoint pricing when the stock ranges over 5c+ in a single day every day?"
Real money buyers (whether it is HF or long-only funds) are interested in getting liquidity and minimising leakage. If you use a crossing system like Instinet's, their marketing would have you believe that information leakage is lower at given size. If you're trying to buy in the millions, then getting them in ones via a robot is one approach, but getting them in a smaller number of larger transactions can speed things up. Spread cost is quite chunky as the stock falls further. Minimum tick size is over 0.4% of the share price now, so if you can minimise the likelihood of having to cross the spread as often, then that's also a potential benefit. It's one of many tools available to facilitate larger trades, but the recent weeks are showing a new pattern so it makes it interesting.
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