Maybe don bright can answer this. Is anyone talking to the SEC on our behalf to get rid of these silly short selling rules for daytraders. Day traders provide liquidity (which is lacking badly right now) so we should be able to trade at will. I see no reason for day traders at prop firms to have to wait for an uptic. IMHO, any short sale that is closed out be end of day should be exempt. As it provides liquidity to the market place. Or maybe a rule where the first 10k shares (that small amount can't manipulate the market) are exempt from the uptic rule. Regulated liscensed day traders should be exempt from the uptic rule. As clearly we are not manipulating anything.
You have raised some good points and ideas, but if you really think about it...since professional, licensed traders Do risk capital, Do risk time, Do provide liquidity...we actually deserve some options available to us. As exchange floor traders, we enjoyed so many benefits that helped us to survive and even thrive when we provided liquidity and sought out disparities....and we still do. If everyone could short on downticks it just might not be a good thing for everyone involved. The guys who were buying bullets and whacking bids on obscure stocks (re) created some of the problems we have today. But, as professionals, we can use other tactics that are available to us to keep our risks under control, sell on down markets, and continue to provide the liquidity to the world...I think keeping the uptick rule in place (for awhile anyway) is probably a good thing). We can sell ETF's, SSF's and use conversions (if your portfolio manager at your firm allows for it).... I really think that we will always "adapt" to the rules, follow them closely, and come out ahead.. our "edge" if you will. Don
Funny in France there is no such silly rules so that independant equity traders have the same right than pro: maybe because there are no prop shops: (Just a joke Don Bright don't worry ) BTW: you should know that by heart: public buys, pro short so how do you want the pro to do this if they allow public to short as easily as them .
I have said this before and I will say it again. Uptick rule exists for the manipulation of the specialists, MMs and the big money players. I don't know what you are talking about Don when you say that the uptick rule is probably a good thing. No it is a pointless rule and should have never been enacted in the first place. If a stock price can get hammered by shorts, well that means noone is willing to buy it so obviously smth is wrong with the stock. Make the specialist step in and support the price, isn't that their job anyway? Funny how during the bear raids in the 1930s, the specialists completely backed away as J.P. Morgan bashed away the stock prices. Hmm was there collaboration, just maybe? I recently went short market with a 100 shares on a new stock I tried. I forgot the symbol, it was a 60 dollar stock about 1 mil average daily volume. I had that 100 shares taken down almost 30 cents in about 45 seconds. How and why, I do not know (I looked away to check a diff position), but there werent any big orders stepping down. As soon as I got filled, the stock ripped right back up to the price range where I sent in the order. Whatever the reasons, whether the specialist is that pathetic that he will try to squeeze 30 bucks out of me or the sell orders just happen to come in that particular order, the point is that the fill of that measly 100 share short is truly pathetic. Best price? Liquidity? Order Flow? Come the uptick rule is so easily abused by anyone who easily gets around it. And those prime suspects are the specialists, MMs and big time smart money.
It is a crooked game we play. Somehow, we have to cheat the cheaters, or ride thier backs. Don't ask me how, I don't know.
Some still want to blame the Specialist (and yes, there may be reason at times)....but I still don't see why. Check the numbers...over 50% of the NYSE volume is done by Program Traders, 30% (or so) done by other professionals (other than the Specialists). Sell SSF's - which, BTW, may just give you all your wish...eliminate uptick rules...."be careful what you wish for" the game we enjoy may change, not a big deal in this day and age. I agree that it's a simple manner of providing liquidity, and that we all (all serious traders) do that, including the Specialists. I thought it was funny when the CEO of AIG was upset because the Specialist wouldn't hold the price of his stock up ....and now I ask you back "why didn't AIG do a stock buyback?" Hold their own darn stock up? Why should you, I,or the Specialist buy a half million shares? That is what he was complaining about (the simple version anyway). We might want to step back and ask ourselves..." is this a game we want to play?" If this "game" was perfect, there would be no edge whatsoever...It would be like buying a selling "EE" Gov't bonds (actually worse than that). Trading is a game, we learn the rules, we play to win....... .....And the only way we win is to either "Provide Liquidity" OR "Find inequities/disparities" in pricing.... Both of which I am happy to do. Yes, the Specialists have an edge, yes exchange members have an edge, yes professional traders have an edge, better jockeys have an edge, blackjack card counters have an edge, faster computers have an edge....(please feel free to add a zillion other arenas where some, just some, have the edge.....and until a pure socialist state develops somewhere in the world, it will probably stay that way).... Enjoy the game, enjoy the day....and have a Great Easter Weekend everyone.... Don (the Progressive Captialist - in an election year - yipes!)