Terry Zink's Cyber Security Blog

Discussing Internet security in (mostly) plain English

It turns out that stock spam works

It turns out that stock spam works

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I just did a search for the topic of stock spam and it turns out that there is a noticeable effect of stock spam and the price of the stock.  You can find an article here or another one here.

The results, however, are just what I expect - investors who try to get into the stock after it has been pumped lose on average 5% in the two day period after it has been touted.  However, for the spammers who bought it before they pumped it, they do, indeed, make money.

I have said earlier that people who receive stock spam ought to just delete it.  It's too late to make money in a stock after it has been pumped.  I have never tracked how well touting stock spam works because I can't be bothered to track it, but it does play into my theory that the spam runs only last a couple of days because profits must be taken quickly.  By the time the spam arrives in your inbox it's too late.  This theory also holds in the rest of the market, that by the time it's obvious too everybody it is too late for everybody.

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