RE: Share price30 Dec 2025 09:39
STTB > What does it mean when there is no spread?
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In AIM's quote-driven system, MMs typically maintain a spread to profit from the difference between buy and sell prices while managing inventory. A wide spread is common for less liquid AIM stocks and signals low activity or risk aversion. But when the spread narrows to zero—meaning MMs are quoting the same price for both bid and ask—it's unusual and can suggest they're short on shares (i.e., they've sold more than they hold and need to buy back to balance their books). To attract sellers and cover their short positions without further driving up the price, they may raise the bid to match the ask, effectively eliminating the spread.This dynamic is amplified in rising markets: the quick 10% gains imply heavy buying pressure, which could leave MMs short if they've been facilitating sells without enough inventory. It's a positive indicator for upward momentum, as it shows MMs are willing to pay up to acquire shares, potentially leading to more price appreciation.