Institutional Investor Cost of Buy Side ManipulatiWhat is the cost of the buy side manipulation of Oncolytics’ stock to institutional investors?
As Cravenraven predicted, these titans of the market have the strength of purchasing power to manage the price to minimize their cost of purchase. The hand of the retail investor is stronger. If they own the stock, the institutional investor can not demand them to sell. They can not even politely ask with a please in front. If the retail investor wants to buy shares in Oncolytics, their modest purchase has no effect on the market. They can take advantage of the buy side manipulation and acquire Oncolytics at a discount. The weakness of the institutional hand is that they want large volumes of shares in the 100s of 1000s at a time when time is running out and shares are scarce.
The practical cost to institutional investors is the opportunity cost of not acquiring their position in time. Through disclosure and transparency, readers of this discussion board are aware of the buy side manipulation. They are holding onto their shares. Excluding trades to depress the stock price, trading volumes are minimal and can not meet all of the demand from institutional investors. Basic economic theory suggests that retail investors who do not read this discussion board will sell their shares if the price increases. The following table is an example showing that institutional investors are being penny wise and pound foolish. The example is based on being short in 10,000 units on an order of 100,000 shares. The example assumes that the stock price will jump to 50% of RBC Capital Markets’ conservative modeled forecast of $26.52 on news of the partnership agreement, and most positions can be filled at the average cost between $6.00 and $13.26. The biggest gain will come from owning the shares: not from nickel and diming over the price. Time is short and Oncolytics’ shares are scarce.
| Short | Missed Opportunity $13.26 less $6.00 | Additional Cost to Acquire | Additional Opportunity Gain | Cost to Support Buy Side Manipulation |
| 10,000 | $72,600 | $36,300 | $36,300 | $36,300 |
| 20,000 | 145,200 | 72,600 | 72,600 | 72,600 |
| 30,000 | 217,800 | 108,900 | 108,900 | 108,900 |
| 40,000 | 290,400 | 145,200 | 145,200 | 145,200 |
| 50,000 | 363,000 | 181,500 | 181,500 | 181,500 |
| 60,000 | 435,600 | 217,800 | 217,800 | 217,800 |
| 70,000 | 508,200 | 254,100 | 254,100 | 254,100 |
| 80,000 | 580,800 | 290,400 | 290,400 | 290,400 |
| 90,000 | 653,400 | 326,700 | 326,700 | 326,700 |
| 100,000 | 726,000 | 363,000 | 363,000 | 363,000 |
The second cost to institutional investors is perception. Participating in a buy side manipulation requires playing by the rule: Do not stand out with an institutional order. Fit in with the retail investor and buy in small lots. Does the buy side manipulation show the shrewd stealth of the institutional investor or collusion within the industry? Are the practices of seeding and spiking examples of reputable trading or simply meant to bully a retail investor? Is posting on a discussion board sharing investor insight or sowing seeds of deceit?