Ariad Pharmaceuticals Inc fka ARIA

[BTH]

This was an institutional trade

Too funny!

So, market-maker's don't facilitate (by committing their own capital) orders for their largest clients as a way of doing more business with them in the future??? Is that what you're saying???

Please explain your comment of "this was an institutional trade". Um, yea... Who's debating it wasn't?

You understand the difference between a market market taking a position for a great client, versus, a market maker printing 1.3 million in a crossed transaction between two parties (two insititional firms)(ex. Wellington on the buyside crossed with Fidelity on the sell side) - in fact, you don't NEED a "market maker" to put up a cross for you - - all you need is a sales desk to cross the order in the NBBO on an exchange - - - or dark pool to facilitate the transaction in the OTC.



So, if you're, say, COWN (Cowen) and FMR is your biggest client who gives you $50 million worth of trading business in a year, and FMR calls you and says, "we need to sell 1.3 million shares on the close", are you going to tell them "NO"? Well, you could, but considering everyone wants FMR's business, chances are you're not going to say, 'no', because they'll just go to someone else that WILL do it. Oh, and by the way, the trading firm that is going to facilitate the trade is likely going to charge 5 cents per share (institutional rate for committing capital)(non-capital committments w/ soft dollar are between .02 - .05 cents per share - even lower, more like .005 - .01 if its electronic algo). So, effectively, the trading firm's breakeven down side is 3.45 (if the trade went down from 3.50)...meanwhile, they made $65,000 putting that trade on, and possibly the ability to make more money if the stock trades higher so they can unload that position over the day the following day.

Do you understand this? I hope this wasn't too much for you, but, this is how it works.....