I am surprised there is no thread about NQ Mobile. I was long the stock and it totally collapsed yesterday on the research report calling NQ a fraud. I figured there was something going on, so I got out with a rather small loss. But then I watched the plunge in amazement. If someone shorted ahead of the report release and the move they made a killing.
Does Muddy Waters take positions before its calls ?
- Thread starter trade2live
- Start date
Yes they do short ahead of releasing their calls.
They murdered Sino Forest in 2011 as well as two other small cap Chinese names. All three were delisted within days of MW's reports.
They murdered Sino Forest in 2011 as well as two other small cap Chinese names. All three were delisted within days of MW's reports.
Of course they would take a position in a stock before publishing a report.
But it's not as if they're doing this on a daily basis.
Also, the report was 81 pages long, so it's far more detailed than the first page summary.
If they were releasing bogus reports, then people wouldn't react like they did yesterday. Although they have had some 'misses' (SPRD, EDU, FMCN) they have also had many 'hits' (CCME, DGW, ONP, RINO, SNOFF).
Link to track record:
http://www.muddywatersresearch.com/track-record/
If they had 8 misses and 0 hits, then it's unlikely NQ would have sold off by 50%. But they do have a track record (5 home runs) that suggests it's worthwhile paying attention to their reports.
But it's not as if they're doing this on a daily basis.
Also, the report was 81 pages long, so it's far more detailed than the first page summary.
If they were releasing bogus reports, then people wouldn't react like they did yesterday. Although they have had some 'misses' (SPRD, EDU, FMCN) they have also had many 'hits' (CCME, DGW, ONP, RINO, SNOFF).
Link to track record:
http://www.muddywatersresearch.com/track-record/
If they had 8 misses and 0 hits, then it's unlikely NQ would have sold off by 50%. But they do have a track record (5 home runs) that suggests it's worthwhile paying attention to their reports.
I find this a bit controversial. If they got famous to the point of moving stocks like that, then they should not be releasing public research that way. Do it on pay subscriber basis, and if you want to "inform the public", go on CNBC and say you are short X and Y, without releasing a report that will crash the stock. They would make more money on subscriptions and also run less risk of lawsuits etc.
no it would be an SEC violation I believe, it's not the 1920's anymore
It's legal if they disclose it.
A couple years ago when I first started following the markets they put out a bad report on HRBN. It tanked and went down to about $6. I bought it around $10 the next day or two then it shot back up to around $18-20 in a matter of days. The CEO wanted to buyout the company I believe and muddy waters kept issuing reports saying it wouldn't go through. It went through for $24 a share.
I am sure they have been right plenty of times too though, just pointing out this instance.
I am sure they have been right plenty of times too though, just pointing out this instance.