Quote from Hydroblunt:
Perhaps you should try using such sources as www.nyse.com for your references instead of you those of Australian stock exchange.
The appropriate sources would be the SEC and the NYSE... Not the NYSE (and not the ASX) (the SEC has regulatory oversight of the NYSE). However, the descriptions on the ASX were more appropriate for this message board than those I found at the SEC. I am aware of the SEC documentation.
No he did not commit a wash trade since he did not hit his own bids. He submitted the order to the specialist who then in turn routed the order to INET and executed them against the trader's own bids, which was not his intention at all. For all anyone knows, he had them out there to get long again and believed into the specialist's supposed duties of supplying liquidity.
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a. Transactions relating to purchase or sale of security
1. It shall be unlawful for any person, directly or indirectly, by the use of the mails or any means or instrumentality of interstate commerce, or of any facility of any national securities exchange, or for any member of a national securities exchange--
For the purpose of creating a false or misleading appearance of active trading in any security registered on a national securities exchange, or a false or misleading appearance with respect to the market for any such security, (A) to effect any transaction in such security which involves no change in the beneficial ownership thereof, or (B) to enter an order or orders for the purchase of such security with the knowledge that an order or orders of substantially the same size, at substantially the same time, and at substantially the same price, for the sale of any such security, has been or will be entered by or for the same or different parties, or (C) to enter any order or orders for the sale of any such security with the knowledge that an order or orders of substantially the same size, at substantially the same time, and at substantially the same price, for the purchase of such security, has been or will be entered by or for the same or different parties.
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PS, the specialist is not required to supply liquidity in normal markets.
I stand by my comment that you are totally clueless.
I appreciate your "honesty." However, my intention wasn't to persuade you that I'm not clueless. Rather, it was to suggest that you might want to consider a more constructive method of communication.
Placing bids & offers all over market depth book is not manipulation no matter what the great all knowing entity of Australian Stock Exchange says. The fact is that even if your intention is to "persuade" others to help you push the price in your favor, you are placing an order out there that is executable and will be executed if you do not cancel in time (unless you are a specialist or MM).
"In essence, a manipulation is the intentional interference with the free forces of supply and demand." ...See: In the Matter of Pagel, Inc., et al., SEC Release No. 34-22280 (1985).
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I hope the above information clears up your misunderstandings.
If you want further clarification or guidance that you can be assured of, please see a securities lawyer; I am not one.
