文档介绍：Market Makers’
Methods of Stock
Manipulation
B Y . CATALDO, PH .D., CMA, CPA, AND L ARRY N.
K ILLOUGH, PH .D., CPA
HOW TRADING MANIPULATIONS CAN ADVERSELY AFFECT A FIRM’S EQUITIES AND WHAT
FINANCE MANAGERS CAN DO ABOUT IT.
f you are involved in the decision to finance assets firms have underwritten, continue to trade, or make a
with debt or equity and pany’s shares are market in. They buy and sell these inventories for prof-
publicly traded or may be, you should watch for it. In theory, they will buy low, which reduces the
and guard against exposure to broker-dealer or decline in price per share (PPS), and sell high, which
market maker manipulation (MMM). In this arti- reduces the rise in PPS. Therefore, these profit-making
Icle, we offer you a primer on MMM, “naked shorting,” behaviors are presumed to provide a stabilizing effect
and -based sources of additional on changes in the PPS of the stocks they make a
By increasing your awareness of market maker manipu- market in.
lation, you may be able to (1) better recognize and Second, they post the bid and ask prices at which
defeat the adverse effects of MMM on your firm’s equi- others are willing to buy or sell and match ing
ty securities, (2) dramatically reduce the risks associated buy and sell orders. In return for performing these func-
with your firm’s failure to maintain