Announcing trades publicly

M

movingslow

This is kind of a newbie question, but I cannot find clear guidelines on this topic:

I sometimes read in the news that a trader got in some trouble after posting their trades on a forum. Apparently, they were accused of some type of price manipulation, i.e. announce publicly that they have bought stock X and then once the followers buy that stock, the original poster sells it, making a profit.

Now, I know that in most cases, there is no real price manipulation. But if you wanted to play it safe, what are the rules for announcing one's trades publicly?
  • Can you openly state that you have bought stock X or that you are short stock Y?
  • Can you also tell people WHEN you have done so or if you intend to do so in the future (e.g. "I'm going to sell stock X later today")?
  • Can you comment on the companies that you own (which could cause their price to move)? For example, you hold a large position in stock X and then write publicly that you BELIEVE that stock X is going to go up because there is a rumor about their product.
 
It's a thin line. Generally, manipulation is the problem but I don't think the sec even pick up on it. There's loads of small fish doing this every day in the small caps.
Rumours are spread all the time by the big institutions but no one can ever trace where they're from exactly.
 
What about hedge funds commenting on their bets or trades? I'm a bit confused because often times I read an article or a newsletter written by a hedge fund manager where they comment on the market or some companies, and reveal some of their positions. There has to be some set of rules that they follow, otherwise the SEC would be after them, no?
 
movingslow said:
What about hedge funds commenting on their bets or trades? I'm a bit confused because often times I read an article or a newsletter written by a hedge fund manager where they comment on the market or some companies, and reveal some of their positions. There has to be some set of rules that they follow, otherwise the SEC would be after them, no?
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They're public, so eventually their positions gets revealed anyways.
(at least once a year)

Also, they are already in the position, or even - was in the past, and it's not like - ,,we are going to take 5Billion position in Coca-Cola''.

The pumping and hype is created via media, random micro financial sites/blogs, wheres redactors/staff/bloggers/youtubers, get's paid to pump out the crap, in order to create the hype/fomo.

Here's nice video, gives a look on Big-Short player Michael Burry's portfolio.

Based on the % in gains, basically you can (in theory) calculate his entry point/timing, in that specific position.

 
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It's a free world and traders have posted about what and how they're trading for years here.

Um that's what a trading discussion forum is for.

You just can't make specific ecommendations about what specific people should do. Not ok to say "newbie9posttroll you should buy 1millon shares of GFY at .01" lol

It's fine to say "I'm long MGM because it looks to me like it may go up"
 
Nobert said:
They are already in the position, or even - was in the past, and it's not like - ,,we are going to take 5Billion position in Coca-Cola''.
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Still trying to understand this though. Is there some time window in the past that they cannot comment on (say the previous month or so)? Because to me it seems that if a hedge fund investor is somewhat respected, announcing their current positions might benefit them if enough followers take the same position. Would like to know if there is some rule that prevents this, or if this is simply not the case?
 
movingslow said:
Still trying to understand this though. Is there some time window in the past that they cannot comment on (say the previous month or so)? Because to me it seems that if a hedge fund investor is somewhat respected, announcing their current positions might benefit them if enough followers take the same position. Would like to know if there is some rule that prevents this, or if this is simply not the case?
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Not familiar with it, so - specifically. There are pros on this forum tho, who might answer it for you and maybe they will.

KCalhoun said:
"newbie9posttroll you should buy 1millon shares of GFY at .01"
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:D:thumbsup:

Or oven better. ,, You should buy Ford now, they're making good cars '', so people type in ticker $FORD.
 
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movingslow said:
Still trying to understand this though. Is there some time window in the past that they cannot comment on (say the previous month or so)? Because to me it seems that if a hedge fund investor is somewhat respected, announcing their current positions might benefit them if enough followers take the same position. Would like to know if there is some rule that prevents this, or if this is simply not the case?
More...
Carl Icahn does it all the time.
 
movingslow said:
I sometimes read in the news that a trader got in some trouble after posting their trades on a forum. Apparently, they were accused of some type of price manipulation, i.e. announce publicly that they have bought stock X and then once the followers buy that stock, the original poster sells it, making a profit.
More...
It is doubtful they would be sued for price manipulation since their actions as described by you are not defined as price manipulation.
 
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