Meant to type "AIB":rolleyes:Quote:
Originally Posted by TheMapMaker007
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Meant to type "AIB":rolleyes:Quote:
Originally Posted by TheMapMaker007
Nice pic! Good Luck..Quote:
Originally Posted by TheMapMaker007
The Motley Fool has been pretty bullish of late.......
http://www.fool.com/investing/genera...ock-moves.aspx
The price hike is right
Raising subscription rates is a dicey move in this economy, but it's just what the doctor ordered for Sirius XM Radio (Nasdaq: SIRI). The satellite radio provider will be jacking up its $6.99 monthly fee for additional receivers within the same account to $8.99. It will also begin charging for its Web streaming service, as it dramatically upgrades the quality of the webcasts.
Is the move going to cost Sirius XM some subscribers? Undoubtedly. However, by telegraphing the mid-March hikes, it will prompt existing subscribers to pay up for lifetime subscriptions or to prepay for a few years to lock in the old rates. Since Sirius is a company that is desperately scrounging for cash to pay off many of its creditors this year, this is a great step to avoid bankruptcy without violating the FCC-mandated rate freezes on Sirius XM's more conventional pricing plans.
Demian, I want to thank you for all of the work and research that you do. It is most appreciated. It takes a ton of time out of your 24 hours and makes a real contribution for all SIRI owners.
Again, thanks!
Bill
It does not work that way. The broker has an inventory of shares that belongs to the broker, that is why they have a short list. The margin requirement has nothing to do with where the shares come from. Your broker requiring you to have a margin account has to do with leverage.Quote:
Originally Posted by trippingthespeculatingpos
You wanna know why it does not work that way ? Lets say that you have 1000 shares of SIRI with Ameritrade that you bought @ .15 the price rises and then I come and short 1000 @ .17. Ameritrade takes your shares and lend them to me, right ? you do not sell because the shares have been appreciating, you are greedy and want more money for them, right ? but what happens next is that, I as a shorter, was right and the price starts coming down. Remember, I have your 1000 shares that are loosing value and I am happy. Next, the shares continue loosing value, .16, .15, .14, .13... I do not want to cover because I am making money, and I am also greedy, however... you panic !!!! and want to sell YOUR shares @ .13 that your broker lent ME... how is he going to return the shares to you so that you can sell them ??? I do not want to give them back, I am making money for crying out loud !!!
That is why your broker MUST HAVE an inventory of their own and they can not lend more shares than what they have. If they do, then they are making "NAKED" calls and that is ILLEGAL.
Can you imagine a market maker manipulating the price ? They have thousands and even millions of shares... They do it, especially during the first 1/2 hour of trading and at the end of the day, perhaps the last 15-10 minutes of trading, when they need to balance their inventories...Quote:
Originally Posted by RickF
Sure makes for a VERY unlevel field - Bastards!!Quote:
Originally Posted by Siriusowner
Tx Again SO!
So that explains the big buys and sells at the beginning 1/2 hour to hour of the trading day?Quote:
Originally Posted by Siriusowner
That is why at the close there is big buying or usually selling?
So, there is two sets of trading going on. The market makers and regular people and it is happening at the same time, right?
Exactly. Market makers are what their name implies and then there's a bunch of other traders like the "specialists".Quote:
Originally Posted by billhart22
http://www.sec.gov/answers/specialist.htm
"A specialist is a member of a stock exchange, such as the New York Stock Exchange, who performs several functions. Specialists must make a market in the stock they trade by displaying their best bid and asked prices to the market during trading hours. They also are required to maintain a "fair and orderly market" in the stocks they trade. They do this by stepping in with their own capital to help reduce market volatility when there are not sufficient buyers or sellers. The rules of the exchange prohibit specialists from trading ahead of investors who have placed orders to buy or sell a security at the same price. The number of stocks a specialist trades depends on how active the stock trades, but most specialists trade between five to ten stocks."
The market makers are the worst though:
"A market maker is a firm that quotes both a buy and a sell price in a financial instrument or commodity, hoping to make a profit on the bid/offer spread, or turn."
http://en.wikipedia.org/wiki/Market_maker
Here's an excerpt of the above definition for market makers that I usually find disturbing:
"Proponents of the official market making system claim market makers add to the liquidity and depth of the market by taking a short or long position for a time, thus assuming some risk, in return for hopefully making a small profit. On the LSE one can always buy and sell stock: each stock always has at least two market makers and they are obliged to deal."
How can you compete with them ??? It is quite an un-leveled play field.
You have really put all of this into perspective extremely well and I appreciate it. I never realized that we were such a system working within a system. That explains why when somebody is shorting the hell out of a stock you all of the sudden see somebody show up buying tons of 100 share lots in a row and then other times selling 100 share lots, right?
yeah that explains alot, thx for giving us info without making us feel stupid, much appreciatted. I guess i was wrong about te shorting, i thought they could take any1's shares and lend them if if they have a margin account, but that makes me feel better knowing they cant. I think it was demian who i heard this from, so blame him haha
If you have a margin account and your shares are not locked up, your shares can be lent out to others for shorting by your broker......
That is a fact...
This guy, Douglas A. McIntyre, really bugs me because he has bashed with inaccurate data about SIRI for awhile now - inflating the debt numbers etc. He has an obvious agenda on the short side with SIRI...
http://www.bloggingstocks.com/2009/0...d-toward-zero/
Stock prices headed toward zero
Posted Jan 24th 2009 6:01AM by Douglas McIntyre
As each month passes, more and more companies get into the kind of trouble that pushes them toward Chapter 11 or insolvency. Some of the companies that hit that point several months ago include Sirius XM (NASDAQ: SIRI) and Charter Communications (NASDAQ: CHTR).
Douglas A. McIntyre is an editor at 24/7 Wall St.
You are going to have to back that statement with something...Quote:
Originally Posted by Demian
When you buy shares with a margin account you are buying shares with borrowed money but the shares can not leave your account without your consent (unless they lose value and your broker liquidates them)... If they do then your broker is violating SEC rules.
http://www.investopedia.com/printabl...securities.asp
Do you have a margin account with your broker? If so, did you know that the shares you have purchased may be lent out to other parties without your knowledge or granted permission? When opening up a margin account you are essentially giving permission to the brokerage firm to lend out the securities in your account even if you don't realize it.
How Margin Accounts Work
A margin account is a way to leverage the capital and securities you own to purchase additional investments without having to invest any additional capital. You simply borrow from your broker to buy more securities. The broker will charge you interest on the borrowed money and use all the securities (those already in your margin account and the ones you just bought) as collateral Note that the risk of trading on margin is greater than trading in a cash account because you can, in theory, lose more money than you started with in your account. (To learn the basics to margin, check out How Does Your Margin Grow?and Leveraged Investment Showdown.)
What Becomes of the Securities in your Margin Account?
The securities in your margin account may be lent out to another party or used as collateral by the brokerage firm at any time without notice or compensation to you when there is a debt balance (or negative balance) on the account where you have accessed the margin funds. If the account is in a credit state, where you haven't used the margin funds, the shares can't be lent out.
The borrowers of stocks held in margin accounts are generally active traders, such as hedge funds, who either are trying to short a stock or need to cover a stock loan that has been called in. Also, investment firms that need an underlying instrument for a derivatives contract might borrow your margined stocks from your broker. The brokerage firm may also pledge the securities as collateral for a loan. (Keep reading about this in When To Short A Stock and our Short Selling Tutorial.)
Also, if your margined shares pay a dividend but are lent out, you don't actually receive real dividends because you aren't the official holder. Instead, you receive "payments in lieu of dividends", which don't qualify for the 15% dividend tax rate. However, you will only have to pay the high income tax rate if the firm clearly states that the dividend income was payment in lieu on the Form 1099-Div - if it isn't stated you will receive the lower 15% rate.
Back to Cash?
If the above doesn't sound too appetizing to you and you're adamant about retaining your vote and want to avoid a potential dividend tax hassle, the easiest solution is to transfer your shares from a margin account to a cash account. Shares held in a cash account can't be lent out, which removes the voting and dividend issues.
However, if you are willing to give up some of the above and take on the additional fees to access the greater capital in a margin account, you will need to ensure that you keep your account in a credit state around important voting times (as the brokerage firm will need to return the borrowed shares).
Share Lending
Shares held in a cash account can be also be lent out if you give the brokerage firm permission, which does present a potential source of additional gain. This process is called share lending.
There can be a lot of demand by short sellers and hedge funds to borrow securities, especially on securities that are typically hard to borrow. Similar to a margin account, when you borrow capital or securities, you are required to pay interest on the amount borrowed.
Depending on market rates and the demand for the securities, the exact amount of interest charged for borrowing securities will vary (the harder to borrow, the higher the interest). The most attractive securities to lend are those that are hardest to borrow for short selling, which usually means small caps or thinly traded stocks as well as shares that are already heavily shorted or have fallen a lot in price.
And this demand presents an attractive opportunity for investors with the securities in demand. If you have a cash account with securities in demand you can talk to your broker and let them know that you are willing to lend out your shares. If there is demand for these shares, your broker will provide you with a quote on what they would be willing to pay you for the ability to lend these shares.
If you accept, your broker will lend your shares out to a short seller or hedge fund for a higher rate and pocket the difference as well as satisfy another customer's demand and generate some commissions. For example, they may give you 8% interest on the loaned shares while lending out at 13%. Depending on the size of your position, it can be a nice additional source of return. This method also allows you keep your existing long position in the security and benefit from its upward movement.
Depending on the broker, they may or may not provide this service. They may also require a minimum number of shares or dollar amount. (To learn more about risky trades, check out Is Pressing The Trade Just Pressing Your Luck? and Scalping: Small Quick Profits Can Add Up.)
Conclusion
Investors should always be evaluating everything on a risk/reward basis from the stocks they invest in to the accounts they open. Margin accounts can be attractive as you can generate a large return by using a brokerages capital. However, there is a greater risk of loss and investors can also lose voting power.
Alternatively, while a cash account may seem boring as there is no leverage, through the practice of lending securities, investors can increase their returns with another source of income.
Tripp...WOW.. I cant believe what I started with what I thought was gonna be a simple answer...And the time Its cost everyone to explain and compare notes...Its very impressive on the combined intelligence on the website...And It confirms my belief that Sirius is a good bet...Thanks & LONG SIRIUS
Ya, you troublemaker! lol I bet Tripps didn't evern sleep last night.Quote:
Originally Posted by Sworntwofun
lol i slept like a baby :O
Slept like a baby?Quote:
Originally Posted by trippingthespeculatingpos
You mean you wake up and cry every hour?
okay i slept like a 60 year old man lol