Stocks, Crypto & Exchange
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📰 Know what you own, and know why you own it. 🤝 ~ Peter Lynch | @Exchange
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📈 Analytical overview of Telegram channel Stocks, Crypto & Exchange
Channel Stocks, Crypto & Exchange in the English language segment is an active participant. Currently, the community unites 34 971 subscribers, ranking 6 824 in the Economy & Finance category.
📊 Audience metrics and dynamics
Since its creation on невідомо, the project has demonstrated rapid growth, gathering an audience of 34 971 subscribers.
According to the latest data from 08 September, 2024, the channel demonstrates stable activity. Although there has been a change in the number of participants by 0 over the last 30 days and by 0 over the last 24 hours, overall reach remains high.
- Verification status: Not verified
- Engagement rate (ER): The average audience engagement rate is 0%. Within the first 24 hours after publication, content typically collects N/A% reactions from the total number of subscribers.
- Post reach: On average, each post receives 0 views. Within the first day, a publication typically gains 0 views.
- Reactions and interaction: The audience actively supports content: the average number of reactions per post is 0.
📝 Description and content policy
The author describes the resource as a platform for expressing subjective opinions:
“📰 Know what you own, and know why you own it. 🤝
~ Peter Lynch | @Exchange”
Thanks to the high frequency of updates (latest data received on 09 September, 2024), the channel maintains relevance and a high level of publication reach. Analytics show that the audience actively interacts with content, making it an important point of influence in the Economy & Finance category.
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Posts Archive
🔵 WHAT IS A DAISY CHAIN❓
▶️ Daisy chain is a term for a financial scam conducted by a group of investors in the public equities markets or in real estate. It is similar to a pump-and-dump scheme. These securities market fraudsters work together to buy a particular security and artificially increase the value of the security. They then flip their ownership of that equity to unsuspecting investors who are chasing an upward trend.
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💰 @Exchange 🪙 | 📈 @Value 📉
🔵 PUMP-AND-DUMP 3.0
▶️ The cryptocurrency market has become the newest arena for pump-and-dump schemes. The massive gains made by Bitcoin and Ethereum have kindled tremendous interest in cryptocurrencies of every stripe. Unfortunately, cryptocurrencies are particularly well-suited for pump-and-dump schemes because of the lack of regulation in the cryptocurrency market, its opaqueness, and the technical complexity of cryptocurrencies.
▶️ A study conducted in 2018 examined the prevalence of pump-and-dump schemes in the cryptocurrency market. Researchers identified more than 3,400 such schemes over the course of just six months observing two group-messaging platforms popular with cryptocurrency investors.
▶️ In March 2021, the U.S. Commodity Futures Trading Commission (CFTC) advised customers to avoid pump-and-dump schemes that can occur in thinly traded or new cryptocurrencies. The CFTC also unveiled a program that would make any whistleblower eligible for a monetary reward of between 10% and 30%, as long as they reveal original enforcement action that leads to monetary sanctions of $1 million or more against a pump-and-dump scheme.
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🔵 AVOIDING PUMP-AND-DUMP SCHEMES
▶️ The Securities and Exchange Commission (SEC) has some tips to help avoid becoming a victim of a pump-and-dump scheme. Here are some points to keep in mind:
🟢 BE EXTREMELY WARY OF UNSOLICITED INVESTMENT OFFERS
▶️ Exercise extreme caution if you receive an unsolicited communication regarding an "investment opportunity." The plethora of avenues for virtual communication means that such dubious investment pitches can reach you in any number of ways—by way of an email, a comment or post on your social media page, a direct message, or a call or voicemail on your cellphone. Ignore such messages; acting on them may result in significant losses rather than the massive gains promised by the scammers.
🟢 LOOK OUT FOR OBVIOUS RED FLAGS
▶️ Does the purported investment sound too good to be true? Does it promise huge "guaranteed" returns? Are you pressured to buy right now, before the stock takes off? These are all common tactics used by stock touts and unscrupulous promoters and should be viewed as red flags by investors.
🟢 LOOK OUT FOR AFFINITY FRAUD
▶️ Affinity fraud refers to investment scams that prey upon members of identifiable groups, such as religious or ethnic communities, the elderly, or professional groups. An investment pitch from a member of a group that you are affiliated with may lead you to believe in its credibility; the problem is that the member may have been unwittingly fooled into believing that an investment is legitimate (when in reality, it is just a scam).
🟢 CONDUCT YOUR OWN RESEARCH AND DUE DILIGENCE
▶️ Before you invest your hard-earned money, conduct your own research and due diligence. It is fairly easy to obtain a wealth of information online about legitimate companies—from their business prospects and management to their financial statements. The lack of such information can often be a red flag in itself.
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💰 @Exchange 🪙 | 📈 @Value 📉
🔵 PUMP-AND-DUMP IN POP CULTURE
▶️ The pump-and-dump scheme formed the central theme of two popular movies: "Boiler Room" and "The Wolf of Wall Street." Both of these movies featured a warehouse full of telemarketing stockbrokers pitching penny stocks. In each case, the brokerage firm was a market maker and held a large volume of shares in companies with highly questionable prospects. The firms' leaders incentivized their brokers with high commissions and bonuses for placing the stock in as many customer accounts as possible. In doing so, the brokers were pumping up the price through huge volume selling.
▶️ Once the selling volume reached critical mass with no more buyers, the firm dumped its shares for a huge profit. This drove the stock price down, often below the original selling price, resulting in big losses for the customers because they could not sell their shares in time.
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🔵 PUMP-AND-DUMP 2.0
▶️ The same scheme can be perpetrated by anyone with access to an online trading account and the ability to convince other investors to buy a stock that is supposedly "ready to take off." The schemer can get the action going by buying heavily into a stock that trades on low volume, which usually pumps up the price.
▶️ The price action induces other investors to buy heavily, pumping the share price even higher. At any point when the perpetrator feels the buying pressure is ready to fall off, they can dump their shares for a big profit.
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💰 @Exchange 🪙 | 📈 @Value 📉
🔵 THE BASICS OF PUMP-AND-DUMP
▶️ Pump-and-dump schemes were traditionally conducted through cold calling. The advent of the Internet has shifted most of this activity online; fraudsters can now blast hundreds of thousands of email messages to unsuspecting targets or post messages online enticing investors to buy a stock quickly.
▶️ These messages typically claim to have inside information about an imminent development that will lead to a dramatic upswing in the share's price. Once buyers jump in and the stock has moved up significantly, the perpetrators of the pump-and-dump scheme sell their shares. In these instances, the volume of the sales of these shares is usually substantial, causing the stock price to drop dramatically. In the end, many investors experience huge losses.
▶️ Pump-and-dump schemes generally target micro- and small-cap stocks on over-the-counter exchanges that are less regulated than traditional exchanges. Micro-cap stocks—and occasionally, small-cap stocks—are favored for this type of abusive activity because they are easier to manipulate.
▶️ Micro-cap stocks generally have a small float, low trading volumes, and limited corporate information. As a result, it does not take a lot of new buyers to push a stock much higher.
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💰 @Exchange 🪙 | 📈 @Value 📉
🔵 WHAT IS PUMP-AND-DUMP❓
▶️ Pump-and-dump is a manipulative scheme that attempts to boost the price of a stock or security through fake recommendations. These recommendations are based on false, misleading, or greatly exaggerated statements. The perpetrators of a pump-and-dump scheme already have an established position in the company's stock and will sell their positions after the hype has led to a higher share price.
▶️ This practice is illegal based on securities law and can lead to heavy fines. The burgeoning popularity of cryptocurrencies has resulted in the proliferation of pump-and-dump schemes within the industry.
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🔵 A MEME STOCK GLOSSARY
▶️ Meme stock communities have developed a specific lingo used in their posts online. Some of these terms include (along with emojis used to denote them online):
▶️ Apes: 🦍 Members of the meme stock community. Some have attributed this to a meme related to the movie Rise of the Planet of the Apes, but others have suggested that the label comes from the banding together of “dumb apes” to take on the Wall Street elite.
▶️ BTFD: 🤬 An acronym for "buy the f***ing dip." Buying the dips means going long on a stock after its price has declined in the near term and is meant to be repeated after each such drawdown.
▶️ Diamond hands: 💎🤲 This has come to mean holding onto a stock despite (even heavy) losses, confident that the price will soon increase.
▶️ FOMO or "fear of missing out": 😨 As in, if you don’t catch the meme stock wave, you’ll regret it.
▶️ Hold the line: 💪 A battle cry to encourage others to stand firm with diamond hands in the face of volatility.
▶️ Paper hands: 🧻🤲 This is a derogatory slur leveled against those who fail to maintain diamond hands. These are perceived as weak individuals without conviction who sell their shares too quickly.
▶️ Stonks : 📈 An ironic misspelling of the word “stocks.” This meme predates WallStreetBets and often depicts a crudely designed bald man in a suit staring blankly at an arrow pointing upward in price.
▶️ Tendies: 🔥🍗 Short for chicken tenders, "tendies" refer to profits made in meme stocks. There are several claims for why this fast-food item is used for collecting profits.
▶️ To the moon: 🚀🌙 The idea that a stock will rise extraordinarily high, as if to the moon.
▶️ YOLO or "you only live once": 🫥 As in, why not buy into a meme stock?
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🔵 OTHER MEME STOCKS
▶️ While GameStop was the first successful meme stock, it was not the only one. WallStreetBets users quickly identified other downtrodden stocks with heavy short interest to boost. These included AMC Entertainment Holdings Inc. (AMC), the movie theater chain that saw flagging profits amid the COVID-19 pandemic, and Blackberry Limited (BB), the outmoded smartphone maker. Both stocks also saw their shares rapidly increase by multiples.
▶️ Indeed, as these became recognized meme stocks, members of r/wallstreetbets and similar outlets began to acknowledge the humor (for the “lulz”) of seeing such legacy companies emerge from the ashes in the stock market.
▶️ Some meme stocks did not fare as well as others, even with the occasional short squeeze. Other meme names have included, among others, Bed Bath & Beyond Inc. (BBBY), Koss Corp. (KOSS), Vinco Ventures (BBIG), Supportdotcom, and even the meme stock enabler Robinhood Markets Inc. (HOOD).
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🔵 GAMESTOP: THE FIRST MEME STOCK
▶️ In August 2020, the YouTube persona Roaring Kitty posted a future viral video laying out the case why shares of brick-and-mortar video game retailer GameStop Corp. (GME) could soar from $5 to $50 per share. In the video, he explained that the stock had among the highest short interest in the market, largely with short positions held by hedge funds—and that these funds would need to cover their positions in the event of a massive short squeeze, driving the stock much higher.
▶️ A few days later, the former CEO of Chewydotcom and investor Ryan Cohen purchased an unknown amount of GME stock, which Gill acknowledged on Twitter.
▶️ In November 2020, it became public knowledge Cohen owned a 10% share in the company.
▶️ On Jan. 12, he joined the board and the stock rose was at $20. By closing two days later, the value doubled; an 8x increase from the price at the time of Cohen’s and Gill’s previous posts.
▶️ Then, in January 2021, the short squeeze that The Roaring Kitty had suggested took place in earnest, with the price of GME shares exploding to nearly $500 amid a frenzy of short-covering and panic buying.
▶️ The main victims of the squeeze ended up being a handful of hedge funds, some of which were forced to shut down due to heavy losses. As a result, the meme stock concept adopted a David vs. Goliath or Robin Hood connotation of taking from the rich Wall Street elite and rewarding the small retail investor.
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