Having Studied a number of Companies listed on the OTC.BB. I have found some similarities between them, they are as follows:-
1) They are all penny or sub-penny stocks (not surprisingly)
2) NITE (Knight Securities) and UBSS (UBS Securities) are in position 1 & 2 for the volume of shares traded for both 2005 & 2006 YTD (9 times out of 10). These volumes are remarkably high, in one case UBSS traded more than three times the issued share capital of one Company over a twelve month period.
3) All of the Companies studied are being or have been bashed incessantly on the Raging Bull bulletin boards.
There were nine stock symbols included in my research
The most severely abused seems to be UNICO (UNCN) OTC.BB
Conclusions
There appear to be two Market Makers (NITE & UBSS) or individuals within these organizations who are either lending out or selling shares that quite simply “do not exist”.
They seem to be picking out penny and sub-penny stocks and gamble on them going out of business (This way they will never have to cover their short position). Then they employ (or they could be doing it themselves) a group of people to bad mouth, slur and generally bash the Company, its management and any genuine investor who happens to post his/her opinion on the bulletin board. Now as NITE & UBSS effectively control the market it would be also very easy for them to lower the share price by trading shares between each other at “Below Market Value”.
So in brief, they are trying to kill Companies where they hold a short or naked short position.
Case Point
AMEP – American Energy Products – Issued Share Capital 456,870,000
Shares Traded by UBSS UBS Securities from 1st Jan 2005 to 31st Dec 2005 =
1,517,414,006
THIS IS FOR INFORMATION ONLY AND SHOULD NOT BE TAKEN AS ADVICE
ALL DATA IS AVAILABLE ON OTC.BB AND MY CONCLUSIONS ARE MY OPINION ONLY.
Disclaimer - I am not a basher, disgruntled ex-employee, hedge fund employee etc etc. I am a regular guy who is fed up with people being scammed.
