“Apple Inc. (AAPL) has announced two financial developments that appear to have excited new institutional investment interest,” Peter F. Way writes for Seeking Alpha. “When a stock in its doldrums trading $6 billion a day jumps to a $14 billion pace in less than a week, the buyers are not likely to be those out of work, too early to retire, involuntary retirees. More likely, they’re the sellers.”
“That sudden kind of volume can’t help but draw in the aid of the big-block market-making [MM] community,” Way writes. “Their shorts in AAPL needed to augment the supply required to fill multi-million-dollar block buy orders puts mondo MM firm capital at risk.”
“The implication currently is that another +$100 from $594.09 to $693.02 is in the offing. With a +16.7% upside prospect, the all-too-real memories of -7.5% price drawdowns in the months following at least 30 prior daily forecasts in the past like those of today, that better than 2 to 1 seems like a good gamble,” Way writes. “If you want a surer ride from lower costs and are willing to take a trifling return of under 20% on your cost, maybe you get on now. But if you’re after thrills, in the hope of avoiding the spills, better to wait to see if the rest of the public crowd clamors to get aboard, pushing the Range Index up above 40.”
“Then the rates of gain have lived in the +65% to +75% annual territory,” Way writes. “Maybe it will happen again. Just watch out for those later steps, maybe more than 4 months from when you’re first on board. They may not ring a bell.”
Read more in the full article here.
Does that mean anything to average non-bots?
A second grader could write an article with a financial spin and Seeking Alpha would publish it.
Exactly.
Yes, it means the stock market is rigged.
Okay, not really. But if anyone can read that and still think Joe Investor has any chance of making any money, I don’t understand how they think.
——RM
That sudden kind of volume can’t help but draw in the aid of the big-block market-making [MM] community.
IOW: Apply a cattle prod and cattle respond. Moo.
“…They may not ring a bell.”
IOW: Needs more cow bell! Clang-clang-clang.