Even when your right, little guy takes it in the chops!!

So Thursday morning I decided to short V(Visa) and THOR(Thoratec Corp) based on their 10 minute charts to test my new theory. The position I want to talk about is THOR. I’m still good on Visa, so there is nothing to say there.

I shorted THOR at $44.54 and to make sure that I didn’t lose to much money while learning to play upside down, I set the stop loss at $45.20 which to me was the point of resistance. By the end of the day Thursday the stock price was $44.97 so I was down just a little bit.

Now comes Friday and I was gone much of the trading day, but when I got home I expect to be sitting pretty on both V and THOR because the market tanked. My short position in V was good, but THOR was stopped out and closed. I thought what the heck, so I did a little investigating and I was a little confused by what I saw. The stock price for THOR opened at $44.70, had a high price of $44.95, low of $42.92, and closed at $43.02. So let’s review, my stop loss is $45.20, high price of $44.95, it never reached my stop loss and never got any closer than .25 cents. So instead of closing my position for a loss, I should be up $1.52 a share or 3.4%.

Dumbfounded, I called TD Ameritrade to discuss and to get an explanation. This is what I was told. During the pre-market trading there was a quote of $45.25, not a sale, a quote that activated my order some how after the market officially opened at 9:30am. There was never a quote or sale that was higher than $44.95 during regular trading hours. Somehow the $45.25 quote got carried over in regular trading hours, activated my stoploss order at $45.20 and then sold @ 45.10.

So my question to him was this, I did not have my order setup to trade in pre market, so what would stop anyone from making a quote of let’s say $100 a share to activate all orders then steal them above the stop loss prices? This is just another way to squish the little man and there is no protection, even though TD Ameritrade tells you to protect yourself with a stop loss order.

This transaction is in dispute and I will know Monday if they are going to re-instate my short position in THOR. There is nothing about this that looks legit, so let’s hope they get it right. Just take a look at the chart and you will see the point.