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Martha Stewart Living Omnimedia Inc. Message Board

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  • apostate_001 apostate_001 Jan 9, 2006 11:32 AM Flag

    Price Manipulation

    SD86, your explanation for strong buying in the last 30 minutes seems very plausible. I tend to accept it, however, what about the fact that there haven't been any shares available for shorting for the past month or more?

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    • There usually ARE some shares to short available to the brokerages, especially if one is a FAVORED customer of a brokerage.

      Remember that daytraders (usually) don't hold positions overnight. So brokerages familiar with their clients will likely let them short naked (is that the term?) since they'll cover by the end of the day. This is probably illegal, but they do it anyway.

      Also, there will be some people covering shorts, freeing up those shares to be re-shorted by whoever is first in line.

      Also, and I'm not totally familiar with this process, but when someone buys puts, the covering options exchange goes out and sells short. This probably factors in, as well.

      So, even if your brokerage tells you that there are no shares to short, in reality there almost always ARE a few shares here and there. And especially at low volume, that can account for the movement.

      • 2 Replies to SD86
      • Thanks SD86 for taking the time to lay out the details regarding the short selling that you believe continues to exist, even though we lumps can not find shares to short. Your knowledgeable response was appreciated.

        Any thoughts about other legal practices that might be manipulating MSO's price that you think might be occuring, additional to these spikes just before closing?

      • Super Strong buy This is a Hedge fund dream 61% of the float is short.. Any buying pressure this thing will run.. This thing is being accumlated in small lots to keep the stock from going on a run. No body should buy this stock on the fundmentals, not this stock.

 
MSO
6.19-0.23(-3.58%)Jun 29 4:06 PMEDT