Bioelectronics Corp (BIEL)

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The Broker Dealers/MMs do what ever will make them the most money

The first important thing to understand is that retail customers Sell to and Buy from the MMs. They are a middle man that takes a cut of every transaction.

The MM mandate is to always provide a Bid & Ask Price so that traders can always Sell shares that they own or Buy shares that they want to own.

MMs are supposed to keep an inventory of every stock that they cover.

What happens if there is high demand for a stock? The MMs can either let the SP rise to a level where legitimate share owners are willing to Sell or they can Sell 'Phantom Shares' that do not exist.

If they Sell 'Phantom Shares' the SP will need to drop to below their Selling price or they lose money when they Cover the Naked Short and MMs don't lose money as they control the Game.

If the Celadon story that was in my last post was read you could see one of many scams that Broker Dealers/MMs can use to steal money from investors.

Here is the scam per the SEC:

"The SEC's order finds that, from at least July 2016 through December 2017, certain broker-dealer customers of Celadon routinely used their accounts held at Celadon to liquidate large volumes of shares in thinly-traded, low-priced, over-the-counter stocks held by their own customers. According to the order, Celadon facilitated its broker-dealer customers' sales into the market by executing short sales throughout the day in a principal capacity. Celadon covered its short positions at the end of the day by buying the same number of shares from the broker-dealer customers at a lower price, also on a principal basis. During this period, the order finds, the trading gains that Celadon generated based on the price differences between the short sales to the market and the shares purchased from its broker-dealer customers accounted for almost one-third of the firm's revenue. The order further finds that, for at least ten thousand of these short sales, Celadon failed to locate shares of those stocks that it could borrow, as is required by the federal securities laws."

https://www.sec.gov/enforce/34-89404-s

75% of today's Volume was FTD, 47 million out of 62 million shares. Was that all legitimate "Market Making" or was the MM trying to cap the SP. Retail investors have no way of knowing.