I got robbed on option expiration Friday!! (option ex pinning)

Quote from sub0:
220,000+150,000=470,000+ shares placed on each side at any given time within a range of 30 seconds to 10 minutes. [/B]
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*correction 220,000+150,000=370,000
 
You didn't get burned dude. You lost. Bad bet. Move on. Everything else is just whining. I expect more from a 'market maker.'
Why didn't you take the other side of your trade. You would have won, no?

Quote from sub0:

After you get burned on something like that, you tend to back off for a while. Not interested right now, just stated we'll see come Monday how pinned it was if at all.
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thats utter bullshit. No market maker in the world can hold the stock if the buy side starts to unload. Well, long holders they did not, thats all. So yes, there may be some pinning action when everyone else sleeps but no market maker could have held up the stock if large holders start taking cash off the table.

There may be more follow through on the downside next week. Note that most banks did not trade up despite the fact that they beat expectations.

Am I a believer in this ridiculous expectation beating game? No, but I follow what the street pays attention to.

Quote from sub0:

Son of a bitch! I bought some BAC puts betting on them missing earnings. They missed earnings and it started to tank. Immediately I started to get excited that I was right! The stock dropped and based on past trends, I figured it would drop at least $2 on the miss.

Well it didn't, it dropped $1 and then traded sideways from the open all day long in a tight range.


Everyone on the BAC forum realized and pointed out that the market maker was pinning it so the large block of calls and puts above and below the price would expire worthless! SON OF A BITCH I WAS ROBBED.

bacoptions.jpg



Just posting this here to vent on this BS manipulation. Someone on the BAC yahoo finance forum pointed out that the same thing happened the last 2 option expirations on BAC and on Friday the same thing happened to the options on GE.
http://messages.finance.yahoo.com/S...d=1211660&mid=1211660&tof=-1&rt=2&frt=2&off=1

All I know is I'm a licensed market maker and pinning and pegging is illegal for market makers also, not just for regular traders! The only time you can legally peg a stock is when it IPOs to help stabalize prices as you dump shares into the market at a certain price that day.

I guess I was a moron for not researching these pinning practices further before holding a position over night like that into option ex, won't do that again!
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second that...

Quote from atticus:

You honestly believe <$7MM per side in shares is going to move $150B in mcap, and a float of nearly 9B shares? Worse, you're stating it wasn't fills, but spoofing? You bought October on reporting day on expiration!

It's a MM-bot, nothing nefarious, and certainly not impacting the market in BAC.
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you gotta be kidding me. 5-6 is NOTHING. If some starts selling in size those sizes are hit in a matter of seconds.

Quote from sub0:

Even if we are conservative and say they were stepping in only every 5 minutes...

avg 5 minute volume (10min/2): 3,039,692


If within 5 minutes they spoof the buy side then later the sell side, that's 370,000x2=740,000

So within 5 minutes, they are indicating 25% of all the volume and price direction if the spoof just every 5 minutes. That's how significant it can impact it.


Not to mention, very few people can slice through that kind of wall buying/selling/trading $5-$6 million dollar blocks. And those that can, are smart enough not to try because they don't know what is behind it if they do.
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Quote from sub0:


Everyone on the BAC forum realized and pointed out that the market maker was pinning it so the large block of calls and puts above and below the price would expire worthless! SON OF A BITCH I WAS ROBBED.
/B]
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Interesting... Imagine for the moment that you actually did make money. You know the pinning worked in your favor. Would you have said that you were robbed?

I suppose not...

You were not robbed you were taken for being so bright eyed...

The market is the only place where mercenary type action is rewarded.
 
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