Market Maker Manipulation!!

[Stocktrading101]

Alright, I wanted to post this up just for educational purposes to show members how the market maker will take advantage of their power and give you the WORST possible price.

The situation:

-The ask was $36.60, the bid was $36.33
-I SHORTED 100 shares, which means that I sold shares I did not have
-So, what the market maker does it gives me the shares at the NEXT purchase of shares.
-You will see a yellow and blue line, the yellow is the ASK, the blue is the BID
-Notice how the yellow line dropped for a split second and came back up,
this was right when I placed my order; SO market maker makes the next purchase $36.33, which means I got my shares shorted at $36.33 putting me down $30 within the first seconds of trade.

This is what we call a BAD BEAT! Solution: Use limits next time

Any questions about it post them up.

Regards,

[WallStGolfer31]

Blain, I don't know about that. 100 share orders aren't usually handeled by market makers from what I've been told. When you put in a market order that just bascially means fill me at whatever price the marekt gives me. In electronic trading when you get an unfilled market order pop up, some day trader/arb guy will fill it below the market price if he gets the chance.

[taylor04]

market makers can be good aswell though, over the weekend someone placed a large buy order on pfe, jumped up 10% today and i sold for a nice 4k profit on the infinite competition:P