Every day, novice and seasoned investors sit in front of their computers and trade stocks online in the equities markets. You feel weak in the knees at the mention of the term “market maker” because of the widespread belief that these individuals unfairly influence stock prices. While partially correct, this is not the main focus of the article. Check out the Best info about Cryptocrime.
Those of any age interested in Internet investing have nothing to fear from market makers. However, they should be concerned about the daily exploitation of stock discussion boards. The pump and dump is the most common name for this strategy. Most new investors believe that this pumping and dumping pattern is the corporation’s standard operating procedure.
Let’s check out (fill in the blank).com. Thousands of individuals visit this site daily to read and post on the stock market message board, so it’s safe to assume it’s rather popular. Joe, who signed up for the site today, is determined to learn all he can about investing to make money there. He browses a few message forums before settling on a stock.
The “Going to the moon” and “Get in now, this chart is on fire,” etc. Postings are not lost on him. He deliberates for a while before investing $5,000 in the stock. As soon as he makes the purchase, the stock price increases by 15%. People are yelling on the platforms, and Joe finally gets the good news he’s been waiting for all day: “The train has left the station.” It’s unbelievable to Joe. In just 15 minutes, he managed to make $500.
However, within 15 minutes, the stock price begins to decline rapidly. Joe’s starting to grow nervous, so he writes some questions on the whiteboard. For example, “Hang on! It’s just the market maker’s trying to shake out the weak hands” or “Load the dips! Load the dips!” are some of the responses he hears. When Joe’s stock dropped 20% from his purchase price, he didn’t sell because he listened to the board and thought it was just a dip caused by the shadowy market makers.
Joe lost 77% of his investment in less than 3 hours. Do you know anything about this? If you haven’t, you’ve come to the correct place, though I highly doubt it.
Every day, investors lose money because paid marketers on stock message boards don’t tell potential victims they’re getting paid to make recommendations. They take people’s hard-earned money and aren’t bothered by it. These paid promoters receive weekly compensation of $3,000 to $7,000. The “People in the know” are taking advantage of investors by walking a stock price up to absurd heights while most are chatting to themselves on five to ten screen names. This is a problem for both inexperienced and seasoned investors.
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