Schwab doesn't like shorting

[Anaconda]

Quote from cybtropic:


I've been shorting long before the uptick rule was repealed and never had a problem with this rule. Just because someone supports the rule doesn't mean they are against shorting.

You're lying. If you were trading equities back before the repeal, it was through your lame Ameritrade account, which makes you Joe Blow and makes your opinion and experience irrelevant.

During any massive dumps on any equity, there was a huge cushion of shorts built up with the uptick rule. Which only promoted heavier hitting down of the stock by daytraders, hedge funds and specialists/market makers.

I've seen stocks taken down points in a matter of minutes simply from a sizeable short sell order from an institution. Something that does not happen without the uptick rule as the short sell order actually gets filled on the existent bids.

 

[Anaconda]

Quote from robbie380:

specialists are for all intents and purposes extinct. further, they could give a shit what the retail guy is doing. they only care about large orders.

No order is too small for the specialist not to try to steal some money from it.

Uptick rule was very employable to their arsenal, they had authorized exemptions under "special cases".

I notice that maybe 5-10% of posters on this topic have any experience with the uptick rule. AngryCat was right, Joe Blow is screwed more with the uptick rule cause only Joe Blow suckers don't acquire a means to go around it.

 

[robbie380]

Quote from Anaconda:

No order is too small for the specialist not to try to steal some money from it.

Uptick rule was very employable to their arsenal, they had authorized exemptions under "special cases".

I notice that maybe 5-10% of posters on this topic have any experience with the uptick rule. AngryCat was right, Joe Blow is screwed more with the uptick rule cause only Joe Blow suckers don't acquire a means to go around it.

have you traded with a specialist before? we have had a few at our office. they don't make their money off of retail traders.

 

[robbie380]

Quote from zdreg:

he was obviously also including market markers on nasdaq etc. in addition he was also including hedge funds who were exempt from the uptick rule for basket execution under certain circumstances. hedge funds also don't like the little guys stepping in front of them.why do u think cramer , najarian and the rest of the crew are in favor of uptick rule. professionals will either get an exemption or a work around which will work to disadvantage of the small trader. it is an old story. the club still exists in 1 form or another.

again.....do you think the little guy with his 25k account really moves things? wow....there are 1000 shares on the offer trying to get short big fuckin deal lol.

 

[robbie380]

Quote from Anaconda:

You're lying. If you were trading equities back before the repeal, it was through your lame Ameritrade account, which makes you Joe Blow and makes your opinion and experience irrelevant.

During any massive dumps on any equity, there was a huge cushion of shorts built up with the uptick rule. Which only promoted heavier hitting down of the stock by daytraders, hedge funds and specialists/market makers.

I've seen stocks taken down points in a matter of minutes simply from a sizeable short sell order from an institution. Something that does not happen without the uptick rule as the short sell order actually gets filled on the existent bids.

and you think the institution getting short doesn't give a damn about their price? do you really think they want a horrible price on their short? also you act like short sale orders wouldn't drive down prices before the repeal of the uptick. whenever you saw a big order a penny above the bid you could be pretty sure it was a short sale if it was driving the stock down.

 

[Angrycat]

Quote from robbie380:

have you traded with a specialist before? we have had a few at our office. they don't make their money off of retail traders.

Anaconda didn't say they made their money off retail customers. But no specialist (barring a total moron) would miss the opportunity to steal if it presented itself and retail orders are easy prey.

 

[Fistfull]

Schwab doesn't have a clue how things really work. The Uptick Rule won't do shit to reduce the losses on your portfolio Charles. Sorry to break it to you. What did big traders do when they wanted to fill big shorts back when we had the Up tick Rule? They had two options:

a) Cheat. Just sell the fucking shares. Big time guys have their own software and the SEC is basically making them self report. "Did you sell those shares on the uptick?" Yes, absolutely I did sir! You think these guys got rich without being clever? Net result? The price goes down very fast.

b) Post a gigantic bunch of offers and watch the price plummet in reaction while taking what they can get on the way down by hitting every uptick and re-posting insanely big offers. Net result? The price goes down very fast.

The interesting part that nobody seems to mention when they talk about the Uptick Rule is that with it around nobody can short sell into people that post huge bids to drive prices up. Want to make money on that long? Just post 100k shares on a downtick. If nobody can hit you short you've just reduced the pool of traders that can hit your bid to those that are already 100k long. Quick fact: there aren't that many traders that will just happen to a) have a long that big, b) are watching that stock at that time, and c) want to dump that long right now. Net result? Price goes up, daytrader makes money.

Who looses with the Uptick Rule? Everyone that doesn't know the tricky ways to make money from it and/or get around it. It ain't the little guy trading the 10k account that knows this stuff and can do it.

It's pretty hilarious to see these investment types with no trading experience that are holding terrible longs try to argue for the Uptick Rule in hopes that it'll makes stocks stop going down. Sure man, good luck. Remember when the SEC temporarily banned short selling of financials a few months ago? Look how well that went.

 

[Robert Weinstein]

Quote from RiceRocket:

Instead of idiotic debating on here from people who really don't understand market internals, I would like to know what NYSE specialists think about this issue.

Are there any left???

But seriously, They along with MMs would not be subject to it so of course they are all in favor of bringing it back. Having an uptick rule gives MMs an edge over the general public.