Time for a minimum $ value trade on ASX?

[moimoi]

Over the past 3 months i have noticed a variety of manipulation techniques for share prices.

I'm sure that those following the smaller resource players will have noticed.

As a case in point here is the trading history for TRF today.

http://www.stocknessmonster.com/stock-trades?S=TRF&E=ASX

Out of 16 trades today 7 were for less than a total of $53.

My question?

Why is this allowed to occur.?

What possible rationale could there be for the first trade of the day to be for 4 shares @ $0.505 for the princely sum of $2.

You cannnot tell me that this was an "investor" adding to their portfolio.!! ???

cheers
Moi

[srotherh]

Moi
Called painting the chart

[shasta]

Moi
Called painting the chart

I'd like to see more disclosure of these kinds of trades as well.

Ie, some may well be the last part of an order...

But i fear, there are more sinister motives behind these

[moimoi]

Moi
Called painting the chart

care to add further expanation SROTHERH?

cheers
Moi

[Huang Chung]

I can beat that moimoi.

One day last week, AMH was up about 7c for (from memory) half a day on the trade of one share at 69c :eek:.

[bermuda]

I can beat that moimoi.

One day last week, AMH was up about 7c for (from memory) half a day on the trade of one share at 69c :eek:.


Well, I think it is the mood of the market going sour. Toyota has just announced production cutbacks. That is a very bad signal and a barrel of honey for the Bears. I dont like this. Just as well China rules. The demand will be there.

[KW]

Not just resource stocks, I've seen it in a number of others. Dozens of trades going through with just one share traded. What is "painting the chart"?

[STRAT]

Not just resource stocks, I've seen it in a number of others. Dozens of trades going through with just one share traded. What is "painting the chart"? I would guess it means changing the SP at close in order to manipulate historical data seen on charts. ( ie price on a chart for each day is taken from closing price )

[David Hardman]

I would guess it means changing the SP at close in order to manipulate historical data seen on charts. ( ie price on a chart for each day is taken from closing price )

Sometimes its about painting the chart but most of these small trades are caused by Algorithmic Trading engines.

Gone of the days when a large order is placed on the market for all to see.. Now orders are sent to a computer where they are sliced and diced to try and hide what's going on.

Look at the orders in the depth for most stocks.. They are not nice round parcels like the old days.

About a year ago the ASX changed the way they charge brokers for their trades. They switched from order based to value based. This made it cost effective to place minuscule sized orders into the market and has increased the algo trading activity dramatically.

Frustrates the hell out of me personally.

[Jay]

I thought there was minimum parcels you could buy related to the price per share.
It must be unless you already have the minimum.
Still I think there should be a minimum for any order, again based on the share price.

[bermuda]

I thought there was minimum parcels you could buy related to the price per share.
It must be unless you already have the minimum.
Still I think there should be a minimum for any order, again based on the share price.

I bought some Texo the other day at 2.8 cents but I couldnt get the last the last 46 shares to complete my 150k order.

By this time the sell had gone to 3.6 so I asked Direct Broking to buy them at 3.6. But they wouldnt because the spread was too wide and at variance with previous trades. So they tried to get them at 3.0, then later on at 3.1, then later on at 3.2 and then finally I got this small finishing parcel at 3.5 or something like that.

Everything finds it own level after a while but I agree small finishing trades can look a bit out of place sometimes.

I thought DB showed a very responsible attitude..even though I was very happy to try and get the last little bit at 3.6, having got the bulk at 2.8.

[srotherh]

I would guess it means changing the SP at close in order to manipulate historical data seen on charts. ( ie price on a chart for each day is taken from closing price )


Yes Strat that is what it means
Trades at close on next to no volume to show daily decline in daily price on chart

[KW]

The trades I've seen are not closing ones, they go on all day. They are responsible for running the price up significantly in an hour or two, then disappear as normal size trades go through, then the share price sinks again to its previous level over the next few days.

[David Hardman]

The trades I've seen are not closing ones, they go on all day. They are responsible for running the price up significantly in an hour or two, then disappear as normal size trades go through, then the share price sinks again to its previous level over the next few days.

Yes.. The overwhelming majority are algo based trades.. The ASX is falling all over themselves to increase these types of trades as well.

Many of the algo engines in place are not trying to manipulate the market.. in most cases they are just trying to slice and dice orders to try and beat the VWAP.

Some interesting reading on the matter

http://www.asx.com.au/professionals/institutional/direct_market_access.htm

http://www.huliq.com/63788/new-colocation-hosting-service-asx-participants

http://t1d.www-03.cacheibm.com/industries/financialservices/doc/content/bin/fss_latency_arms_race.pdf

http://www.finextra.com/fullstory.asp?id=15955

[David Hardman]

I would guess it means changing the SP at close in order to manipulate historical data seen on charts. ( ie price on a chart for each day is taken from closing price )

Its always surprised me that chartists use the closing price rather than the days (or periods VWAP. Why is this? Anyone know? Is it cos the VWAP is not generally made available?

[Phaedrus]

Hi David,
I would dearly love to be able to utilise VWAP as well as the Close, but I am unaware of any data supplier that provides it. Certainly mine doesn't. P.

[STRAT]

Its always surprised me that chartists use the closing price rather than the days (or periods VWAP. Why is this? Anyone know? Is it cos the VWAP is not generally made available?I collect it each day on stocks I own or am watching but historical info is not available from anywhere I know of. This is a real pisser cause when something catches my eye its often when volume is low and charts are easily painted to steal a phrase.

[moimoi]

Yes.. The overwhelming majority are algo based trades.. The ASX is falling all over themselves to increase these types of trades as well.

Many of the algo engines in place are not trying to manipulate the market.. in most cases they are just trying to slice and dice orders to try and beat the VWAP.

Some interesting reading on the matter

http://www.asx.com.au/professionals/institutional/direct_market_access.htm

http://www.huliq.com/63788/new-colocation-hosting-service-asx-participants

http://t1d.www-03.cacheibm.com/industries/financialservices/doc/content/bin/fss_latency_arms_race.pdf

http://www.finextra.com/fullstory.asp?id=15955

Thanks for your input David....

cheers
Moi

[KW]

Yes thanks.

[KW]

Speaking of automated trading, what happened on the ASX today at 2pm? A 75 point drop then recovery...

[h2so4]

Speaking of automated trading, what happened on the ASX today at 2pm? A 75 point drop then recovery...

Chart painting. The paint brush slipped.

[Bilo]

Sometimes its about painting the chart but most of these small trades are caused by Algorithmic Trading engines.

Gone of the days when a large order is placed on the market for all to see.. Now orders are sent to a computer where they are sliced and diced to try and hide what's going on.

Frustrates the hell out of me personally.

Thanks David H
I share your sentiment.
The articles you posted summarised everything that is bad about the ASX and indicate to me exactly why and how the NZX should differentiate themselves from this viral infection to the world's bourses. I was particularly amused by IBM's intro - well it would be funny if this technology wasn't deadly serious in its potential applications. A way of making the very rich even richer while killing innocents on the way and opening the door to the world's darker forces through the anonymity it provides.

[shasta]

I collect it each day on stocks I own or am watching but historical info is not available from anywhere I know of. This is a real pisser cause when something catches my eye its often when volume is low and charts are easily painted to steal a phrase.

Stockness has the VWAP freely available each day?

[Phaedrus]

Direct Broking have VWAP freely available every day, but you really need the historical data to make any real use of it.

[David Hardman]

Speaking of automated trading, what happened on the ASX today at 2pm? A 75 point drop then recovery...

Human error :)

http://business.smh.com.au/business/error-wipes-qbe-out-20080730-3n7p.html

Someone will be looking for a new job tomorrow.

[Bilo]

Human error :)

http://business.smh.com.au/business/error-wipes-qbe-out-20080730-3n7p.html

Someone will be looking for a new job tomorrow.

These pricks have a very naive view of the world that they have created and preside over.

"Because the price error was so drastic, it effectively removed the stock from the index," he said.

The financial index on CMC fell from 4530 to 4250, just 280 points, or 6pc. The XJO.ASX or CMC's equivalent of the ASX200 dropped 80 points, people sold, people lost money, the operators probably made money. The index was uncertain of itself for the remainder of the trading session.

The whole trading place needs to be slowed down to a pace that can be effectively managed, "human errors" of this magnitude are crazy and simply add to the idea that the ASX is a jungle, dog eat dog, well get eaten by the biggest beasts anyway...banning derivatives of all kinds would be a good start...and then perhaps we wouldn't need these b bots..

Read all about it - in the press the day after - OK for the insiders..

[h2so4]

These pricks have a very naive view of the world that they have created and preside over.

"Because the price error was so drastic, it effectively removed the stock from the index," he said.

The financial index on CMC fell from 4530 to 4250, just 280 points, or 6pc. The XJO.ASX or CMC's equivalent of the ASX200 dropped 80 points, people sold, people lost money, the operators probably made money. The index was uncertain of itself for the remainder of the trading session.

The whole trading place needs to be slowed down to a pace that can be effectively managed, "human errors" of this magnitude are crazy and simply add to the idea that the ASX is a jungle, dog eat dog, well get eaten by the biggest beasts anyway...banning derivatives of all kinds would be a good start...and then perhaps we wouldn't need these b bots..

Read all about it - in the press the day after - OK for the insiders..

Damn I missed all the action. That would have been fun to watch.

[brettdale]

Over the past 3 months i have noticed a variety of manipulation techniques for share prices.

I'm sure that those following the smaller resource players will have noticed.

As a case in point here is the trading history for TRF today.

http://www.stocknessmonster.com/stock-trades?S=TRF&E=ASX

Out of 16 trades today 7 were for less than a total of $53.

My question?

Why is this allowed to occur.?

What possible rationale could there be for the first trade of the day to be for 4 shares @ $0.505 for the princely sum of $2.

You cannnot tell me that this was an "investor" adding to their portfolio.!! ???

cheers
Moi

Heck and I thought I was a small time trader!!!!!