What Is Joint Manipulation?

Pool operation refers to the use of two or more people to form a temporary organization to jointly manipulate the securities market. The organization can gather funds, trading skills, experience, and related talents and information to cooperate to achieve the purpose of manipulating the market. Joint operations usually require the operator to join hands with senior executives of securities issuers or key members of the board of directors.

Joint manipulation

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Pool operation refers to two or more people, forming a temporary organization, and operating jointly

Refers to two or more people, forming a temporary organization, and using joint means to manipulate

Joint manipulation refers to the use of two or more people to form a temporary organization and the use of joint manipulation

The constituent elements of joint operation are:

1. Subjectively, there is a common meaning connection between two or two actors.

2. Objectively engaged in concentration

There are two forms of joint manipulation:

1. Joint Trading Manipulation (Trading Pool)

Joint trading manipulation, that is, the stocks required by the joint manipulator are bought directly by the manipulator at the most favorable price on the open market, and then sold at a high price.

2. Option pooling

Joint option manipulation, that is, the operator first purchases a certain stock option with limited supply, good reputation, and attractive customers to control the trading rights of the stock; then, the stock is traded through different accounts of the broker, As a result, there are many trends in selling orders, and through the promotion of company directors, brokers, and investment advisory publications, the stock price rises. Finally, the stock option is sold or further shorted by the manipulator, which forces the stock price to fall and then takes the opportunity to make up for the stock.

Article 71 (1) of China s Securities Law stipulates that it is forbidden for anyone to jointly manipulate securities transaction prices through conspiracy to obtain improper benefits or pass on risks, or use information advantages to jointly manipulate securities transaction prices; Interim Measures for Prohibiting Securities Fraud Article 7 stipulates that "any unit or individual is prohibited from using its funds, information, or other advantages for the purpose of gaining benefits or reducing losses, or abusing his power to manipulate the market, affecting the securities market price, creating the illusion of the securities market, or inducing or causing investors to Making securities investment decisions without understanding the truth of the facts disrupts the order of the securities market. "At the same time, Article 8 of the interim measures also clearly includes" manipulation of securities market prices through conspiracy or centralized funds "as the manipulation of the market.

Therefore, joint manipulation in China is a manipulation that is explicitly prohibited by law. However, because Article 35 of the Securities Law stipulates that "securities are traded on the spot." Therefore, the problem of joint manipulation of options does not currently exist in China, and the behavior of joint manipulation mainly occurs in the stock market.