MATRIX Penny Stocks

[DCschmoeka]

esteban & Spreads -

Spreads differ widely as you mentioned. This is due to various reasons, but in general, spreads have the effect of discouraging buyers. Some reasons:

- The float of the stock might be low, so the market for that stock is not very liquid. MMs dont have many shares, because there simply are not many shares existing.

- Low volume: Even though the float might be big enough, unpopular stocks often have big spreads too. Those stocks only have a very few trades every day, or only trade a few times in months. MMs try not to hold large amounts of those stocks.

- MM Games. MM play games on OTC all day. If they want to keep down buying pressure for whatever reason, they spread the bid / ask, even though float and volume might be great. This may serve as a test how serious buyers are. E.G., SIDY spread to .10x.12 when buying came in..... than trades stopped shortly, as buyers were rethinking their decision. When the Ask at .12 got smacked, the spread tightend to .115x.12.