NGL is available to manipulation because of a number of reasons. I'll be tied up all morning so time is extremely limited, unfortunately.
1. Trading volume is relatively small. This makes it an ideal "partner in crime" in that it takes a small number of units to move its market. I could easily drive the unit price point down by selling off in one account only to capitalize on the market reaction buying in another account. I don't engage in this sort of tawdry business because I know I'd be causing pain. But it should help you understand.
Think of it as a large soap bubble. If your hands are wet and soapy, you can sometimes stick your fingers into the bubble! Brokers do this daily---compressing prices one way or another, creating false momentum. High frequency trading algorithms are designed by psychologists to maximize investor sentiment. They know what will likely trigger a massive surge in optimism or doom & gloom. And they won't hesitate to use I to advantage.
2. By depressing the investor sentiment, the manipulator can design a price point swoon and capitalize on it by employing a different account. Marketmakers do this routinely by amassing larger quantities of shares and keeping them out of the market for part of a day, suppressing sentiment shifts. This can hurt investor resolve easily.
Example: I've been teaching the first half of this day. I just a moment ago see NGL is up 25 cents. If it drops back to $10.80, I'd be expecting tomorrow's opening to wobble about and probably fall to $10.45 of thereabouts. This would set things up for a field day on Monday with the MMs I firm control because they can pull the largest amounts of units together easily just by accumulating units comprising trades set to execute.
By the way, any broker engaged in buying and selling a stock is a market maker. He makes the market for that particular offering. He collects units or shares to cover trades in motion but is free to squish things around. This is why I almost never do trades unless they're on an AON basis (all or none). I want to see my offer accepted and executed without feeling like a mouse to be toyed with by the MM. Years ago I'd place an order for 500 shares of something and then watch as six shares went through, then 29 or 146---all of which was very frustrating because the result was that the price was dropping and I
was overpaying by the time my order filled. Nowadays I do only AON trades.
I've got to get back to portfolio management now but a closing thought:
MMs are usually straight up. They are accused of being sorry-assed nasty critters but I've known a bunch and they were fine people, really. They have rules of engagement and they follow them to a "T" or they'd be closed out of their professions. They have a bad rep because disgruntled investors like to have a scapegoat and they'll pin a tail on any body not in the immediate environment. I know better.
Let me know if this helps at all.
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