RE:RE:block tradesHotDiggityDogg wrote: Isn't block trades kind of negative for the stock ? Meaning they don't want the sellers to flood the market with their shares so they buy the shares on a block trade ? Just trying to understand the whole concept!
no - it's how a lot of institutions trade large orders of shares. both buying and selling. prior to the advent of electronic trading and algo trading it was also the predominant way for institutions to trade.
it's a trade made off-market based on the current market price of the stock. I think it can be done at the bid/ask or anywhere in between. if an institutional wants to buy 200K shares of WELL, that is 1/5 of the avg daily volume. obviously, an open public bid of 200K would send the share price higher. same with a 200K order on the ask.
so institutions make orders with their brokerage houses who hold them in an internal order book then try to pair up the order internally (ie. one client wants to buy, one wants to sell). or they solicitor other traders at other desks for a matching order. once they make the trade, it's printed publicly on the market. sometimes banks will short sell a stock to fulfill an order as well. let's say their client wanted to buy 200K but they couldn't find any sellers. the trader will short 200K shares, fulfill the client's buy order, then they will take the risk of closing off their short position on the open market.
all of that being said, the fact there are more 50K/100K/150K share orders of WELL going through lately tells me institutions are trading the name, which I view as positive here. especially since the share price has been rising lately.