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+--- Thread: Odd lot buys (/showthread.php?tid=2703)
Odd lot buys - davidhmtk - 02-01-2013
Why all the odd lot buys? Opinions, please. 90's, 51's, 29's. Just a guess - it is signalling
RE: Odd lot buys - trans - 02-01-2013
imo, the odd lot buys most likely are because someone has figured out how to avoid "stock ahead". Odd lot transactions, regardless of the amount are executed on the next round lot trade. Looks like someone is trying to get to the head of the line.......anxiety is likely increasing to own ioc stock..
RE: Odd lot buys - jft310 - 02-01-2013
This Trans is a smart guy huh,
RE: Odd lot buys - Stavros - 02-02-2013
From: marketinout.com
If we could find an investor who was always wrong and do the exact opposite of him, we would always be right! Odd lot indicators strive to do just that. If we assume that small investors ("odd lotters") are inexperienced (and thus usually wrong), then trading contrarily to the odd lot traders should be profit-able.
The higher the OLSR indicator, the higher the percentage of odd lot shorts and the more likely the market will rise (proving the odd lotters wrong). Similarly, the lower the OLSR, the more likely a market decline.
Generally this rule (invest contrarily to the odd lotters) has held true. Odd lotters tend to be reactive rather than proactive. High Odd Lot Short Ratios tend to come after major market declines (when investors should be buying, not selling) and low readings usually come after long market advances.
In 1986, the number of odd lot shorts reached levels that were unheard of. The explanation I have heard for this is that specialists are placing multiple odd lot short orders to avoid the up-tick rule which states that a short order must be processed on an up tick. They do this on days with major declines in prices.
If this explanation is true, it drastically complicates the interpretation of all odd lot indicators. It would mean that the odd lot indicators show what the "littlest" guy is doing, except when it reaches extreme readings in which case it would show what the "biggest" guy (the members) is doing
RE: Odd lot buys - trans - 02-02-2013
Stavros, spot on. The daily odd lot shorts/total odd lot sales used to be an invaluable important bottom indicator and it likely still is, even tho the parameters have changed. Occasionally I check this number series and note that very high odd lot short sales (daily) occur often, telling me that big investors are still using the odd lot pipeline with multiple odd lot orders to get executed on the next round lot transaction (position faster). This reveals a unique high anxiety to get the orders off and as such becomes an excellent sentiment indicator. The other really valuable odd lot T/A I learned is that at major stock market bottoms, Odd lotters turn into "buyers on balance" (vs odd lot sales). again, the anxiety trade to get long executions. Don't follow these indicators as much as I used to, but believe they still reflect rare events and valuable sentiment changes. I call indicators of this type "extraordinary event" indicators.
RE: Odd lot buys - trans - 02-02-2013
The highest odd lot short sales to total odd lot sales usually occurs right after major market bottoms usually happen, where the market has an initial rallyy higher, then rolls over. That's the rollover point where maximum wall street pessimism causes the biggest rush into the highest odd lot short sales, expecting the worst. That combined with "buyers on balance" used to be very effective on spotting the real bottoms