What will be the end result of the elimation of bullets be on pro firms/traders?

sdtrader · Nov 20, 2003

I will admit when I first heard the news I thought it was going to be just awful. But after only three days I have yet to really miss them. Trading has been fine and there has been a lot of money to be made, so far no big deal at all.
As far as firms are concerned, there is no denying that a big part of their volume and profit structure was from bullets, but they will adapt and adjust...everything will be fine.

Sardo_Numspa · Nov 20, 2003

I hear next they're going to outlaw bear markets. Only one direction -- up!

indahook · Nov 20, 2003

Quote from I Missed Boat:

They weren't a shady concept because there is no harm done in shorting, even on a down tick. [/QUOTE

Shorting is a very important part of an efficient market...when done properly. i.e you locate the stock and borrow it( at a negative rebate..blah blah). But bullets are/were not a real short position..you are not using stock from the real inventory. You make the argument that going short puts the cabash on excessive buying...I say that bullets drive prices down excessively

jem · Nov 20, 2003

People were flat at the end of the day. You know what drove down prices excessively. Investment bankers at the clients of the SEC. Telling employees and officers of tech startups to borrow against thier options as if their stock prices would go up forever.

Possibly illegally, putting collars on options and all sorts of market rigging shannigans. Do we have to go over all the tactics they used to screw the public. What about the mutual funds. Bullets were temporary intraday horse crap, investment bankers promising lucrative jobs to their regulators are forever. Who do you think hires ex sec employees.

I Missed Boat · Nov 20, 2003

Quote from jem:

People were flat at the end of the day. You know what drove down prices excessively. Investment bankers at the clients of the SEC. Telling employees and officers of tech startups to borrow against thier options as if their stock prices would go up forever.

Possibly illegally, putting collars on options and all sorts of market rigging shannigans. Do we have to go over all the tactics they used to screw the public. What about the mutual funds. Bullets were temporary intraday horse crap, investment bankers promising lucrative jobs to their regulators are forever. Who do you think hires ex sec employees.

YOU TELL 'EM!!

gimp570 · Nov 20, 2003

In my opinion one of the big reasons the SEC did away with bullets was because, of a large number of day traders using bullets, when these funds were trying to short stocks. The traders would see a market short (an offer following the stock down) then use a bullet, hit the bid and make the funds pay up for there short. They simply got sick of having to pay up and these big players are much more important to the stock market then day traders so they simply did away with bullets....

Our loss...

I Missed Boat · Nov 20, 2003

Quote from I Missed Boat:

YOU TELL 'EM!!

jem · Nov 20, 2003

gimp you may be right, completely or partially.

indahook · Nov 20, 2003

Quote from jem:

People were flat at the end of the day. You know what drove down prices excessively. Investment bankers at the clients of the SEC. Telling employees and officers of tech startups to borrow against thier options as if their stock prices would go up forever.

I am not saying that bullets caused the mkt to downturn. Everybody knows you have to cover that pos by EOD. By the time the daytraders are covering their asses the big players who wanted/needed to be involved have stepped back to let the little guys do there thing thus creating very imbalanced moves. We have all seen it on the level two at one time or another

Don Bright · Nov 20, 2003

Quote from gimp570:

In my opinion one of the big reasons the SEC did away with bullets was because, of a large number of day traders using bullets, when these funds were trying to short stocks. The traders would see a market short (an offer following the stock down) then use a bullet, hit the bid and make the funds pay up for there short. They simply got sick of having to pay up and these big players are much more important to the stock market then day traders so they simply did away with bullets....

Our loss...

Simple market efficiencies...remember, those buyers saved money buy paying less....

Markets will always equal out in the long run.....the bullets really are such a small part of the scenario...

But you have a valid point, of course...

Don