Ruby Creek Resources Inc RBYC

VWAP Double Counting Volume........

[imnironman]

We're obviously all watching every tick in Ruby and as a result it's plain to see that the selling the last 2 days has been different than anything we've seen before.  If you've been keeping tabs on the bids and offers you will have noticed that despite there only being 500 shares being bid for or offered, we've been seeing multiples of that trade at given prices.  Up until now the size of the bid or offer basically told us what we needed to see trade before Ruby could go higher.  The difference the last 2 days has been that the sell order has been IN THE MACHINE as opposed to somebody just trading it themselves.  The difference is......a person handling the order responds to what he sees being bid or offered.  THE MACHINE RESPONDS TO VOLUME!!  I handle institutional orders all day long and a good number of those orders are called VWAP orders.  Volume Weighed Average Price.  A customer would typically use VWAP in order to avoid buying at the top or selling at the bottom on a given day.  The VWAP allows them to spread the order out equally as volume trades over the course of the day.  The result is a fill that is usually close to the average price that day.  The reason I know that this is what's happening with Ruby is because I can see in a "condition" field that I have on my trading screen that it says "AP" which is Average Price.  Yesterday the majority of the volume traded toward the end of the day.  After the first 12 thousand shares traded a lot of 10k traded that said average price.  Then another 20k traded and another 20k printed again that said the same thing.  That is resulting in the appearance that the volume is greater than it is.  Yesterday 30k shares were double counted.  I left work early today but about 13k shares had traded and then at about 1:00  a block of 12,450 traded that said "AP".  Meaning that, of the first 13k that traded 12,450 was part of a VWAP trade that someone had put in the machine.  Hopefully you guys are getting the gist of what I'm trying to explain.  In a nutshell.....someone is putting an order to sell RBYC into an algorithm. When volume trades in the stock the machine automatically starts executing the order.  Unless there is a limit on the order it will execute regardless of price.  If I enter 30k shares VWAP over the day or a certain period of time the machine will complete the order within that framework.  This is something you DO NOT typically see in this type of stock.   Especially given the fact that you can end up being almost 100% of the volume which defeats the purpose of using VWAP.  That's really all I can tell you.  There's no way to tell how big the order is.  Part of the allure of the machine is also anonymity. 

[sittingbullish]

Interesting.... so since this is NOT typical in this type of stock, what is your best guess on a reason for it taking place?what is the profile of a person or group would do this?  why?  Institution/big money?  Savvy individual ??my guess is the algorithm is too much for any individual.... may be a sign of larger money entering ??  but that would beg the question, how does any

[imnironman]

Your guess is as good as mine as to why the seller is choosing to execute the order this way.  And algo's  are accessible through most brokerage firms.  It's just not a strategy that a regular retail investor would even know existed.  So my guess would be that it's someone who has a brokerage account at a firm where they have access so they decided to try and be