What do one share buy/sells mean?
Discussion
Hi all
I'm following (and investing in) a thinly traded company where the founder still retains 80% of the shares.
When looking at the share trades via LSE I often notice that there are multiple one share trade transactions. Iirc these are usually sells. And the share price is under £20 so it's not as though some small investors may just own one share.
Does this mean something?
I also note that whenever a big trade happens ie £50k or more it always seems to be 'unknown' ie it's not labelled buy or sell.
Can anybody shed any light on this?
Thank you
I'm following (and investing in) a thinly traded company where the founder still retains 80% of the shares.
When looking at the share trades via LSE I often notice that there are multiple one share trade transactions. Iirc these are usually sells. And the share price is under £20 so it's not as though some small investors may just own one share.
Does this mean something?
I also note that whenever a big trade happens ie £50k or more it always seems to be 'unknown' ie it's not labelled buy or sell.
Can anybody shed any light on this?
Thank you
A trade can't be a buy or a sell. For a trade to happen you need to have someone to buy the share that someone is selling, or vice versa. There's always exactly the same number of sells as there are buys.
Hopefully someone has some suggestions as to what might be driving this kind of behaviour.
Hopefully someone has some suggestions as to what might be driving this kind of behaviour.
Where are you seeing these single share trades? If you're looking at the exchange prints / market depth you will see stuff like this all the time I expect, regardless of company (although if you look to the US I expect the likes of BRKA have it all the time).
For example, if you want to buy 1000 shares and at the top of the book there are offers for 999 @ a price of 10 and 1000 at a price of 10.01, this would (to my knowledge) show as a trade of 999 @ 10 and 1 @ 1.01, so in this scenario there would be a single buyer and two sellers.
There could also be algos at play, basically software built by brokers that will go to market and work orders for you at a lower commission rate than you'd have to pay for an actual human trader (and to my understanding, in large/liquid names probably just as good/better than a human). I don't know much about the inner workings of these algo strategies, but they sometimes have names like 'Sniper', so I would assume it's within the realms of possibility that they might take single lots at opportunistic times/prices as well.
In short if you're looking at actual exchange prints, I would say this is just normal market activity. If somehow you've found actual investors taking and single shares that aren't part of a bigger parcel, it's probably corporate actions related (ie dividends mentioned above) or to do with getting access to the AGM or something along those lines. Or a stupid retail trader buying something and paying comms equivalent to %50 of the notional.
For example, if you want to buy 1000 shares and at the top of the book there are offers for 999 @ a price of 10 and 1000 at a price of 10.01, this would (to my knowledge) show as a trade of 999 @ 10 and 1 @ 1.01, so in this scenario there would be a single buyer and two sellers.
There could also be algos at play, basically software built by brokers that will go to market and work orders for you at a lower commission rate than you'd have to pay for an actual human trader (and to my understanding, in large/liquid names probably just as good/better than a human). I don't know much about the inner workings of these algo strategies, but they sometimes have names like 'Sniper', so I would assume it's within the realms of possibility that they might take single lots at opportunistic times/prices as well.
In short if you're looking at actual exchange prints, I would say this is just normal market activity. If somehow you've found actual investors taking and single shares that aren't part of a bigger parcel, it's probably corporate actions related (ie dividends mentioned above) or to do with getting access to the AGM or something along those lines. Or a stupid retail trader buying something and paying comms equivalent to %50 of the notional.
So many possible reasons. As others have said though, there's not a buy or sell associated with trades since you need both to result in a trade, depending on the site you're looking at it might be inferring from whether the bidder or seller crossed the spread to do a trade. If you're on the LSE site, check trade flags and cross reference to here:
https://www.londonstockexchange.com/help/whats-iss...
Which may explain more and see if there are consistent trade flags associated with your 1 stock trades then let us know and I'll be happy to dig into it. What's the stock? Thinly traded and founder owned implies a quote driven market like AIM or AQSE and behaviour on smaller stocks/markets can look odd to the non professional.
All regulated markets have serious market supervision teams (I work at one, I know) and manipulation is unlikely.
https://www.londonstockexchange.com/help/whats-iss...
Which may explain more and see if there are consistent trade flags associated with your 1 stock trades then let us know and I'll be happy to dig into it. What's the stock? Thinly traded and founder owned implies a quote driven market like AIM or AQSE and behaviour on smaller stocks/markets can look odd to the non professional.
All regulated markets have serious market supervision teams (I work at one, I know) and manipulation is unlikely.
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