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LLOY - Share buyback 2019

lse:lloy

#242

It is SETS traded. MMs are not influencing the price.
How many times does that need saying.

soi


#243

A million more times… x1000


#244

Everybody knows it’s the teletubbies. Not MM’s


#245

I would rather the buyback fund was a larger dividend personally.

Are these staff share bonuses just a tax loophole, why hand so many out just to buy them back? Cant they just pay the wages instead of this merry go round?

Seems shareholders are getting a raw deal in LLOY. The staff do well and shareholders pay them a bonus out of their own pockets.

I await the disputes but what’s the point of being a shareholder for the diddy dividends, thousands tied up and one market correction would wipe out all those years of dividends?

To my mind, without a more stable and increasing share price, this share remains a dodgy performer.


#246

Pretty much sums it up


#247

steady now Soi, keep an eye on the old blood pressure there me old m8
No emotions remember lol !!

Games - now where are those damn pills !!


#248

Is this correct?

I did not know that SETS stands for Stock Exchange Electronic Trading Service. It is a system. As far as I can see it does not have any cash.

So what happens if there are more sellers than buyers or vice versa. If I decide to sell or buy 3271 Lloyds share how is this matched almost instantly with buyer / seller looking 3271 Lloyds shares.

This would appear where the market makers come in. They provide “liquidity”. This simply means that they have both a buy price and a sell price - neither is set by the system. The traders, not Teletubbies, set these prices. The system provides for market makers. See https://www.lseg.com/markets-products-and-services/our-markets/london-stock-exchange/exchange-traded-funds/market-makers. Further investigation shows that there is a special transaction just for market makers. See “executable quotes” here: https://www.lseg.com/areas-expertise/our-markets/london-stock-exchange/equities-markets/trading-services/domestic-trading-services/sets.

It seems to me that market makers are vital for the efficient operation of the market through SETS.

But Regardless is not totally correct - they do set their prices but they set prices in response to sales and purchases. If they find themselves with too much stock on their books then they will reduce their prices. If they find themselves short of stock then they will increase their prices. Within reason, they react - very quickly - to the market rather than determine the market.

I still cannot understand why Lloyds price has dropped with a massive buyer taking up 26m shares each day. I would have thought that would create a shortage, and increase prices.

However, nice to see a small rise in price today. As Regardless observed, we are in for a long testing summer trading season. I’ll ride it out on the sunny South Coast whilst others scalp a fortune or two from the beautiful Italian lakes.

Have a great weekend
Peter McCallum


#249

#250

I do not have a subscription to Investors Chronicle.


#251

@pelim I dont too. Should be free link to read. Breaks it down well


#252

Consider the volumes, and dark pool distribution.


#253

Hi @pelim, These days market makers are really only required for investments that aren’t traded that often and somebody needs to be there to buy and sell or you wouldn’t be able to trade the investment at all. But all FTSE 100 stocks now are managed by SETS I believe, with these stocks there are always sufficient buyers and sellers at any instant in time for a trade to be done - so market makers are not required for the most part. See explanation here:-

https://www.fool.co.uk/investing-basics/how-the-stock-market-works/sets-and-seaq/

Pretty well all investments (and all FTSE 100 companies) still have market makers though as they are still required to execute some types of trades. But if you are buying or selling a FTSE 100 stock online through your broker then your trade will be done using SETS.

Just because LLOY are spending umpteen million a day buying shares unfortunately does NOT guarantee that the share price will rise. If it doesn’t it’s simply because other people have sold more shares than the company has purchased.

ATB

Pref


#254

Also have to take into account when a share is an absolute pig, and buyback can often be a sign of desperation


#255

Hi @Armageddon, Well I don’t know about that, in LLOYs case they have been very clear that they are doing it to reduce the share count doubtless due to the dilution effects of their bonus schemes. I don’t see that as desperation, just providing employee benefits.

But I.personally would agree with those who favour receiving an increased or a special dividend instead of the company doing a buyback. At least as a shareholder you get some definite reward by them doing that. With a buyback it might well do nothing to help the share price and then frustrated investors feel like its money that’s been wasted. A bit like the current LLOY buyback…

ATB

Pref


#256

This share is collapsing since 1999. And still looks as bearish as ever


#257

@PrefInvestor1 obviously periods arise to make money. And maybe income from it too. But in general terms, it’s a Long term pig

1999… And and all i hear is brexit is holding it back


#258

Depends what year you invested. And periods of no div in SP slaughters.

Much the same as capital chasers.

Different scenarios for different times of buyers


#259

How many years of little to no div since 1999? So deduct inflation for all those years plus capital depreciation. Let me know how the income buyers did.


#260

I’m not disputing the reward when its there and beating inflation.

But timing is probably as important as to capital chasers. There are years you could have invested for income here, and their is no chance of ever recovering. No matter what future div is. Timing important.

Yes. Most buybacks are designed to reward the board. Just lucky If rising SP is a side affect


#261

Well LLOY is highly profitable AND with the end of PPI will be even more so. But it’s the old fundamentals vs sentiment issue again, many see LLOY future prospects being hitched to the UK economy and the housing market. Anything that comes up that threatens those (including brexit) then. LLOY share price suffers.

When will this problem be overcome, well that’s the big question. Not before the end of October or whenever brexit actually happens, and maybe not then, If things go badly for the economy. Irrespective of how much profit they are making I reckon.

ATB

Pref