Once again the abrupt end to the run on penny stocks come about because broking houses have decided to clam down on the limits for the stocks and declare such stocks as designated. Such a procedure cannot be allowed to happen. Declaration of a stock as designated should come from the governing authorities and not from the broking houses. Imagine such arbitrary declaration by the broking houses may be open for manipulation by some people although the run in penny stocks is also probably due to the syndicates manipulating the stocks. Then again, what is a stock exchange for? The broking houses have already set a limit for each client and a limit for each remisier. Shouldn't that be a basis for their trading? If each time there is a run on the penny stocks the broking houses come and designate the stocks then the stock exchange might as well delist such stocks.
Friday, 27 April 2012 16:42