6 comments

[ 2.5 ms ] story [ 16.7 ms ] thread
You could make good money owning a news company by manipulating stock prices like this
Until you went to jail.
Is it illegal? As far as I understand it's the business model for Mark Cuban's sharesleuth.com (although he fully discloses that's what he does)
Very much so. Cuban's site is supposedly legitimate news and he is making decisions based on said legitimate news. If one were to do the above mentioned it would be like "pumping and dumping", albeit in the other direction.
They're investing based on true information they find out about fraud, not spreading misinformation to manipulate the market.

"We're looking for companies that were built for fraud, for executives who are enriching themselves at shareholder expense, and for businesses whose behavior runs counter to their stated objectives or to the public interest."

"In certain instances, the majority partner of Sharesleuth.com is going to make personal investments based on information we uncover. Those investments will be fully disclosed, so that readers can evaluate any potential conflicts of interest.The reporters and editors , however, will maintain policies of not holding individual securities, and we will report Sharesleuth.com stories no differently than we have others throughout our careers. "

Even if you restrict yourself to true information, there is still a ton of space to manipulate stock prices. A good writer can make a company look brilliant or like a loser using the same set of true facts.