Insider trading vs Tape

D

dividend

Nov. 20, 2012, 2:02 p.m. EST
SEC alleges largest-ever insider-trading scheme

CR Intrinsic Investors liquidate[d] $700 million in positions in Elan and Wyeth, as well as establish $960 million in short positions against the companies’ shares.

The move worked. The day after the negative data were released, Elan’s stock slumped 42% and Wyeth dropped 12%,

http://www.marketwatch.com/story/se...ading-scheme-2012-11-20?link=MW_story_popular


This is the largest "insider trading" position published



My question is does anyone see footprints of this in "the tape"?

Tape readers should have been able to see such a huge footprint
 
bump


again, the magnitude of this insider trade is --
$700 million sold
then additional $900+ million shorted


no tape readers saw this?
 
they aren't dummies and prepared for it long time ago..you not going to find any MM names,ID's,tags or whatever in data available for general public.IMO-most of current trading on US exchanges is more or less "insider trading". think about it..in order to make the money off the market you must have an advantage over other market participants. ONLY THEN it can be a SURE THING. it could be a technical advantage OR inside info.
 
Quote from dividend:

Nov. 20, 2012, 2:02 p.m. EST
SEC alleges largest-ever insider-trading scheme

CR Intrinsic Investors liquidate[d] $700 million in positions in Elan and Wyeth, as well as establish $960 million in short positions against the companies’ shares.

The move worked. The day after the negative data were released, Elan’s stock slumped 42% and Wyeth dropped 12%,

http://www.marketwatch.com/story/se...ading-scheme-2012-11-20?link=MW_story_popular


This is the largest "insider trading" position published



My question is does anyone see footprints of this in "the tape"?

Tape readers should have been able to see such a huge footprint
More...

I'd have to have 1-minute data to be sure, but given the way my algorithm works, as these stocks dropped (assuming they didn't gap down), I would have gotten short. The way I read "the tape" is that every rise eventually becomes a shorting opportunity and every fall eventually becomes an opportunity to go long.

The entire algorithm is an attempt to define "eventually" in quantitative terms.

If you're not doing insider trading, I think that's the maximum you can do and some will do it better than others.
 
Quote from dividend:
----largest-ever insider-trading scheme
----$700 million in positions....
----as well as $960 million....
----The move worked.
----negative data was released....
----stock slumped 42%....
----another dropped 12%....
----footprints of this on "the tape"?
More...
They had the "sense" to trade the underlying instead of out-of-the-money put options thereby leaving a much more obvious "footprint". :( :mad: :eek:
 
Market can't detect a $1.5 billion dollar trade coming from one individual

There is no hope at all for technicals or algorithms that try to detect this stuff
 
Quote from logic_man:

I'd have to have 1-minute data to be sure, but given the way my algorithm works, as these stocks dropped (assuming they didn't gap down), I would have gotten short. The way I read "the tape" is that every rise eventually becomes a shorting opportunity and every fall eventually becomes an opportunity to go long.
More...

Like most biotech stocks with clinical trial results due to be released at a certain time, ELN ran up over a period of months leading into the announcement of results. It would be easy for a hedge fund to build a long position of 20 million shares over time and they were likely responsible for driving price as they built up the position anticipating good news. On 6/17/08 alone ELN traded more than 30 million shares (far above the daily average).

There was then over a month where price consolidated near their highs. Somewhere in that consolidation period is probably when the insider lets them in on the fact that the results are not so good. They now have to liquidate the longs and get short, but that long consolidation prior to an anticipated study release offers time for them to liquidate and reverse.

On 7/29/08 price closed at 33.75 in the middle of the consolidation at highs, and the next day it opened at 21.74. That day and the next price consolidated around 20.00, then on 8/1 it opened at 11.03.

Two big gaps, not a gradual breakdown.
 
Quote from NoDoji:



Two big gaps, not a gradual breakdown.
More...

In a situation like that, I could say at what price you "should" get short, but if the stock gaps beyond that price and never recovers to reach it, there's little point in taking the trade or you'd want to take it in a smaller than usual size because you'd have greater risk on the entry.

Big gaps like that always make it difficult to get optimal entries.
 
he sold 10 million shares in 4 days then went short another 10+ million

basically godzilla tiptoed by and nobody heard anything


if your algo/filter sniffs for trade anomolies by an informed trader by analyzing the tape, and they did not show up, you can throw away that algo in the garbage right now
 
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