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Re: TOZ post# 69440

Tuesday, 12/15/2009 2:00:59 PM

Tuesday, December 15, 2009 2:00:59 PM

Post# of 111729
Market Makers make money when they buy shares at the bid and sell them at the ask. If the bid is .011 and the ask is .0125 then they're making .0015 per share. That's why it seems that you can hardly ever buy at the bid and sell at the ask. YOU can sell at the bid and buy at the ask because you're selling TO MMs and buying FROM MMs mostly. Sure there are matched orders too, but MMs make money when they are making the market. So the best case scenario for them is to make sure they buy a boatload of shares low (soak up), say at around .01 and then sell those shares as quick as possible when the ask is higher, say .015 and they make a quick 50%. And they do this all day long. When there's a breakout coming they know before any of us do, so if you watch them on level 2, sometimes you can get a good sense of when they're gonna let if fly. When the breakout comes it's like christmas morning for them, and us, the guys that stuck it out waiting for the SP to finally correct.