is this legal?
- Thread starter qdz2
- Start date
Quote from qdz2:
Still no one explains word except no. Are special interest groups do this all time? SEC, come to my bed room.
Ok Q. the reason it's illegal is that it creates a false market...for instance: You are sitting there trading and you have Volume break outs as one of your parameters....and a stock called ABCD pops up on your filter and says it's now traded 100,000 shares today , when in fact it's 4 week daily volume average is 15,000 shares a day.....you might be more inclined to buy it right?
Ok, So im a Market Making firms with 200,000 shares of ABCD in my inventory a price of 5.oo per share....i sell 50,000 shares and the guy sitting on the other side buys it form me....daily volume is now 100,000.....and here comes QDZ with his 1000 share order , most likely above market, because hi filter says this is a volume breakout and somebody must know something.....clearer now?
Quote from qdz2:
Thank you , TM_Direct. That is a very good reason. I understand now. Seems firms and their affiliates are doing this all the time.
Just because something is illegal doesn't mean its still not done....but the NASD is 'usually' pretty good about this however, ecn's do allow for this type of trading....alot of up start ECN's would pay a room full of traders to buy millions of shares of a stock an the other side to buy it....all for rebates.
Re: is this legal?
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Quote from qdz2:
The same individual or group acts as the buyer and the seller of a transaction?
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-Same individual would be painting the tape.
-Members of a group who share equal profits would be painting the tape.
-Members of a group whose profits are not commingled could be painting the tape if the trade was designed to manipulate the stock.
Although sometimes a trader will shift his position and risk to someone else in the group (negotiated trade)with a seperate account and trading interest.... this probably would not be considered illegal.
If the sole purpose of a trade is to manipulate and deceive with artificial volume.... it is illegal !!!!!!!!
Banker
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to deceive with artificial volume is illegal.....but individuals are aloud to buy and sell the same security for hedging purposes.....i suppose qdz2 was referring to buying a security from himself or selling a security to himself (I believe that is illegal because it serves no purpose whatsoever but to paint the tape)
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Quote from qdz2:
The same individual or group acts as the buyer and the seller of a transaction?
--------------------------------------------------------------------------------
-Same individual would be painting the tape.
-Members of a group who share equal profits would be painting the tape.
-Members of a group whose profits are not commingled could be painting the tape if the trade was designed to manipulate the stock.
Although sometimes a trader will shift his position and risk to someone else in the group (negotiated trade)with a seperate account and trading interest.... this probably would not be considered illegal.
If the sole purpose of a trade is to manipulate and deceive with artificial volume.... it is illegal !!!!!!!!
Banker
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to deceive with artificial volume is illegal.....but individuals are aloud to buy and sell the same security for hedging purposes.....i suppose qdz2 was referring to buying a security from himself or selling a security to himself (I believe that is illegal because it serves no purpose whatsoever but to paint the tape)
Quote from TM_Direct:
it's illegal.....unless your are merrill or Citi and are pitching Enron and wocm to your clients to buy while you are selling...then it's ok
I knew a really nice guy at Merrill who got caught washing trades. He was trying to pump up the volume in Value Line futures. Merrill fired him on the spot.
Quote from qdz2:
The same individual or group acts as the buyer and the seller of a transaction?
Yes, it can be legal.
If the intention is to paint the tape, obviously this is a career ending crime.
However, let's say two traders work for the same prop firm.
Let's say Schonfeld trader bob offers out some IBM at 80, and Schonfeld trader mike takes the offer. Nothing illegal here at all.
I used to do that... but I got better fills going through someone else...
I think you should learn some a.b.c
http://www.elitetrader.com/vb/showthread.php?s=&threadid=14404
"Friday as of opening RCA started to go up. Bragg made in kind sell 25000 actions with the one of the participants of the pool and buy of it the same number at the same price for another of the participants. It was beautiful work. Action RCA was worth 107 dollars."
http://www.elitetrader.com/vb/showthread.php?s=&threadid=14404
"Friday as of opening RCA started to go up. Bragg made in kind sell 25000 actions with the one of the participants of the pool and buy of it the same number at the same price for another of the participants. It was beautiful work. Action RCA was worth 107 dollars."