Solar Wind Energy Tower Inc. (fka SWET)

[Nomad505]

Your explanation does make sense.

Especially when you add in another layer to the theory.

How do the Market Makers make money? They are either working both sides of the book and trying to catch a small difference between the prices or they're basically taking commissions for each transaction.

Since SWET is working in a narrow range I think that it's likely to be the latter.

My broker has a small per share charge for routing to a specific ECN. As I understand it they are making money from routing my order using their "intelligent" routing. If they are in control of where the transaction is sent it doesn't cost any additional money.

Seems to me that a MM might short a stock temporarily in order to make sure that they have the transaction. Once they are in control they are free to use their resources to find the best deal on another ECN for themselves to make a small profit.

This also lowers their own risk since they don't have to maintain an inventory of shares to participate in the market.

Plus, it's always possible that they'll get lucky and cover at the lower price. That's the ultimate goal...