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Re: nagoya1 post# 10807

Thursday, 01/16/2014 11:53:09 AM

Thursday, January 16, 2014 11:53:09 AM

Post# of 14330
I knew you were joking - not so sure about RBKMA ;).

As for the size on the bid, I have no idea. Honestly I've never cracked the code on the trading that goes on with these bankrupt shells, and I've seen dozens of similar instances as I mostly focus on bk companies. Take WHAIQ for instance - completely worthless and has been for years, yet it still trades. One theory is that 'cellar boxing' is quite lucrative for the market makers even though there is very little volume in absolute dollar terms. So if you are making a market in a penny stock that is .092 x .093, or even .09 x .10, you are making at best a little better than 10% for taking on the risk. On a stock that is .002 x .003, however, you are making 50%. It wouldn't surprise me that certain small mm have a vested interest in keeping these little shells trading. There was an old saying that nasdaq mm desk traders drive BMWs and Mercedes, pennystock mm desk traders drive Ferrari's and Lambos. If you google 'cellar boxing' there are a few interesting articles on the topic.
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