Why the fascination with MMs and manipulation in LLEG?
Pull up the level II for LLEG. Currently one would go to sleep trying to detect any trades occurring. Now pull up the level II for AAPL, where MMs make the NAS market, instead of the NYSE Specialist. Quite a bit more activity - isn't there?
What is the function of the MMs for a stock? The same as the traditional Specialist - to ensure orderly trading, and making sure the best price for the seller-buyer is obtained. The only trading the MMs are making (or their computers are making) is from the pool of stock they are required to have in order to manage the stock. They can scalp fractions of cents for an AAPL trade for profit, as they round robin trade. Try translating that into scalping from 0.0052 trades in fractional amounts for LLEG. Reference the book: Day Trade Online by Christopher Farrell. He lays out how the scalping occurs with the NYSE Specialists.
Neither is LLEG going to attract any Hedgie or Tute attention. Too few trades. However, they can turn their trading desk computers loose on an AAPL where there are hundred of thousands of trades over a day's time, and make money there. They need trade volume, not total volume, in order to make it worth their while.
There's just no evidence of any sinister manipulation occurring in LLEG. Rather it's individuals buying and selling upwards of mllions of shares at a time, and/or trying to get some beer money on the side. Seems like a lot of effort, but to each his/her own.
If and when this stock ever would hit $10, then one can worry about the big kid games.
AI
