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  1. #1
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    Institutional investor AI drive the market...

    My opinion is that their objective quant’s logical buy/sell trading models are not tuned/learned to react or respond to significant illogical and/or irrational market behavior which explains the whipsaw swings. Not sure how the market makers subjectively set their prices with any confidence. Also believe the retail investors have minimal effect although their stop-loss executions effect individual equity pricing which may skew the AI.

    This explains the effect of the circuit breakers and buy/sell orders are executing in the nano-second and respond or react with nano-seconds as they churn. The only real benefactors of an unstable market are the actually trading houses receiving fees based on every buy and sell.

    The wild down swings will clear out the legacy/fresh stop-losses and the market will eventually stabilize - at what level? Who knows.

    I’m also not yet convinced that government efforts should be exercised in an attempt to artificially manipulate the private equities market...

  2. Member
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    #2
    Yeah, my concern is all of this junk is happening way too quickly. Eventually the only place we can go is up.

  3. Stocks/Investments Moderator boneil's Avatar
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    #3
    I can agree with what you're saying. Only add the large market swings can also be attributed to funds liquidating and margin calls. None of us are original thinkers when it comes to the market. What I mean is, we have original ideas, but there are many who have the same ideas. So when a margin call hits one, it probably hits many. When one of us thinks we need to buy or sell BA, there are many who think the same way.
    Thanos was the hero

  4. Member
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    #4
    Agree with you on the nano-effect of margin calls. Also the short squeezes, naked calls, straddles, and other leverage/hedging strategies predicated on a rational market...