Market Manipulation: A Comprehensive Study of Stock Pools
34 Pages Posted: 3 Nov 2008
Date Written: September 2004
Using a hand collected new data set, this paper examines in detail a classic account of stock market manipulationâ¬ the â¬Sstock poolsâ¬? of the 1920s, which prompted the current anti-manipulation rules in the United States. We examine abnormal turnover and returns and the relationship between them, as well as the long-term performance of the selected stocks. We conclude that the evidence suggests informed trading rather than manipulation. Our findings have implications for regulatory policy as well as the investigation and prosecution of manipulation cases.
Keywords: Manipulation, Market regulation, Politics of finance
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