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Market Manipulation: A Comprehensive Study of Stock Pools

Authors: Jiang, Guolin
Mahoney, Paul G.
Mei, Jianping
Keywords: Manipulation;Market regulation;Politics of finance
Issue Date: Sep-2004
Series/Report no.: FIN-04-022
Abstract: Using a hand collected new data set, this paper examines in detail a classic account of stock market manipulation—the “stock pools” 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.
Appears in Collections:Finance Working Papers

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