Mr Cooper Group Inc fka COOP

[Wamook]

Crazy Ivan Correction

If you are buying a very large block of stock....

Think of the scene in Wall Street (the movie) where the guy walks on to the trading floor to make a purchase of a very large block of stock... And then the floor manager and the buyer walk over to the market maker. Does anyone here remember that?

There are firms out there that will help investors acquiring very large blocks to do it without moving the market price. I remember one of the Bloomberg interveiws about a year ago when a guy was talking about his firm that specialized in exactly that. No sence walking in playing Mr. Big Deal when they just jack the price up on you. Right?

At any given time there's probably a lot of stop loss orders in the system and if you can trip a bunch of them, you get a big dip in the price. Volume slowed down just prior to the drop yesterday. But it wasn't just the nine million shares that traded at the bottom. There were a hundred million shares that traded that next hour. And for a good portion of that time both Scottrade and Etrade were appologizing to their customers that they couldn't get orders to fill.

There's a profit taking curve on the end of today's trading.

The thing is that the recent moves in the price attracts a lot of attention. It draws in opportunists looking for a quick score. It draws in swing traders inexperienced with the stock who make purchases and set up stop losses. We're running about 41 million shares on the daily average. So in ten days the average dollar volume is nearly a quarter billion dollars with a half a penny or a quarter of a penny or a tenth of a penny going to the makers in every share traded. How many shares traded yesterday? I'm not sure how many dollars they made but it's a nice days work when this happens. Crazy Ivan.

http://papers.ssrn.com/sol3/papers.cfm?abstract_id=1509607