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Re: abbam post# 16513

Wednesday, 07/18/2007 9:48:48 AM

Wednesday, July 18, 2007 9:48:48 AM

Post# of 51429
FWIW here is my theory on the non-trading issue. With a bit of broker dealer experience under my belt (5years), I know that we have restricted stock lists that are created for various reasons. Usually the reason is "unable to settle", which means that the MM's are unable to deliver the shares. This supports Lowmans over sold NSS theory as well. So, if many broker dealers are unable to buy, the market begins to dry up so that when people DO sell, there is no buying market due to the restriction, ergo the price goes down. By this mechanism, the MM's who are short can ride the sell-side bias market down and cover (maybe) once the price is low.

thoughts on this?

also, some AH trades could be MMs cross trading to reset the short covering period, I think its 13 days or something. I know it was on the series 55 license exam but I took that a few years back
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