The work of the Stock Exchange

Bibliographic data

Monograph

Identifikator:: 1831284952

URN:: urn:nbn:de:zbw-retromon-225876

Document type:: Monograph

Author:: Meeker, James Edward http://d-nb.info/gnd/126597340

Title:: The work of the Stock Exchange

Edition:: Revised edition

Place of publication:: New York

Publisher:: The Ronald Press Company

Year of publication:: [1930]

Scope:: XVI, 720 Seiten; Illustrationen, Diagramme

Digitisation:: 2022

Collection:: Economics Books

Usage license:: Get license information via the feedback formular.

Chapter

Document type:: Monograph

Structure type:: Chapter

Title:: Chapter IX. The odd-lot business

Collection:: Economics Books

250 THE WORK OF THE STOCK EXCHANGE ments, the odd-lot dealer is apt to be “damned if he does and damned if he doesn’t.” Risks of Loss to the Odd-Lot Dealer.—I]t has been pointed rut that the odd-lot dealer must temporarily go short of stock when his customer buys, and go long of it when he sells. One inevitable disadvantage under which the odd-lot dealer must labor is the constant risk of suffering actual losses by sudden rises or declines in the prices of these stock commitments, whether long or. short. The odd-lot dealer has to take these losses constantly, and frequently they benefit his customer. To illustrate, in a typical instance a customer ordered, with instructions to “wait for sale,” 50 shares of a stock, for which at the time 13 was bid and 18 asked. Since the next sale occurred at 14 he got his stock for 1424. But on the sale following that, the price had risen to 18. Had the customer ordered 100 shares instead of so he might have had to pay 18 for it. Furthermore, the odd- fot dealer was faced with a loss of 374 in covering the short sale which he had made to obtain the 50 shares for the customer. Such cases where the odd-lot customer gets off much better than either the 100-share customer or the odd-lot dealer are by no means rare. Conversely, in the event of a rapidly sinking market, the seller of odd-lots may often have a similar advan- tage over both a seller of 1bo-share lots or the odd-lot dealer. In this connection it must be remembered that the odd-lot dealer is always willing to sell or buy odd-lots of stock. In less than 100-share orders his function is akin to that of the “jobber” in the London Stock Exchange; he is the core of the whole market, in which the commission broker is a middleman. There is keen competition between the odd-lot houses on the Exchange, and to hold his business the odd-lot dealer must con- stantly assume the risks of his calling. Expenses of the Odd-Lot Business.—Apart from the risks which must be taken. the odd-lot dealer is in some respects

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