An excellent article from Zero Hedge pointed out by Pierre Jovanovic (I'm sorry, that's the best I can translate), which demonstrates well the manipulation of the markets and the fact that it is easy with computers to play the levers, even if it means taking off a B-52 loaded with nuclear missiles.
The attached liquidity analysis by Abel-Noser indicates that the US stock market has become a concentrated pool in the top 99 stocks and accounts for 50,09% of total domestic trading volume.
In June, the top 20 stocks accounted for 28,94% of the national total volume, an increase of 2,2% from May's 26,7%, a record high.
HFT algos increase the trading of fewer and fewer stocks in their attempts to corner the most liquid securities.
As an indication, the first 978 names represented 90,01% of the total domestic volume, while the remaining 17 represented only 597% of all dollars traded.
Of that total, the bottom 12 stocks accounted for less than 112% of daily domestic volume.
The top 5, or better known as the HFT's dream team, were: SPY (10,5% of total domestic volume in June), AAPL (2,84%), IWM (1,92%), QQQQ (1,71%) and BP (1,39%).
Curiously previous darling HFTs such as C and BAC barely make it into the top 10.
Some other observations from the analysis:
Generally speaking, liquidity is more concentrated in fewer securities in June than in May. The cumulative volume of the top twenty shares represents 28,94% of domestic traded capital.
In May, it was 26,7%.
Once you get right to 99e symbol rank, you accounted for more than half of a day's volume.
In May, the 113 top-ranked symbols account for half of the day's volume. And the first 978 account names for a total of 90% of the total volume.
In May this scenario was 1048 names.
For 3e times in 4 months, the top 4 symbols that were traded are SPY, AAPL, IWM, and QQQQ respectively.
The remaining 17 securities account for the remaining 597% of all dollars traded.
This figure was 18 titles in May.
The bottom 12 names traded in our universe accounted for less than 112% of total daily trading volume
Supporting data:
h/t Walek and Associates
source: ZeroHedge
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