Price Manipulation on AIM

chucknorris

Headancer wrote: »

Is there anybody here who is part of any shareholder associations who feel there life savings have been subject to price manipulation on the AIM ?

I would never invest my life savings in a single company, and I would definitely not invest at all in a single company listed on AIM unless I had concrete evidence that it was hugely undervalued (which in terms of probability is on a par with me finding a herd of unicorns).

Old_Lifer

I have holdings in several AIM companies but in total these represent just several percent of my share portfolio. They are the 'fun' part of my portfolio. I rarely look at my mainstream shares nowadays but check my AIM shares daily. I am not too concerned with the share price but am more interested in new announcements and developements.


I read the chat boards on my AIM shares daily but I never post anything. A few individual posters have a good knowledge of a company and their posts are informative but the vast bulk of the posts are idle chatter with a few individuals seemingly trying to talk-up the share price and a few others apparently trying to talk it down. Some posters seem to have little knowledge of the company and may be simply there in the hope of a quick profit.


Share prices on AIM can be very volatile and a share price may fall steeply only to go back up again not long afterwards. A suggestion often made on the chat boards is the possibility that this may perhaps have been done to trigger stop-losses and some shareholders may not be aware that their share holding was sold when the price fell. I have no idea whether or not this is true but for this reason I would not use a stop-loss on AIM.

Linton

Old_Lifer wrote: »

.......
Share prices on AIM can be very volatile and a share price may fall steeply only to go back up again not long afterwards. A suggestion often made on the chat boards is the possibility that this may perhaps have been done to trigger stop-losses and some shareholders may not be aware that their share holding was sold when the price fell. I have no idea whether or not this is true but for this reason I would not use a stop-loss on AIM.

Or it could well be that the shares are illiquid and rarely traded but someone needs to cash in a large number of shares. Under these circumstances they may accept a low offer which will be immediaately reflected in the published price. The price will then increase steadily over time as other investors buy in to what they believe to be a bargain.


Just because an AIM or other small company share is priced at say 10p, it doesnt mean you will actually be ableto buy or sell at that price.

Headancer

Can we stick with the premise of the original question rather than froth.

For the "hard of understanding" as we appear to have mr Thicko contributing, ill rephrase.

Is anybody a member of a shareholder association where a PART of their investment has been affected by short selling ?

cloud_dog

I hold an AIM stock and the price can be a) quite volatile, and b) being depressed.

This is not manipulation, merely the effects of the mechanics involved in this particular company in order for it to deliver on its promise. It is not generating revenue currently so it needs to periodically issue shares or take on debt, often in the form where the debt/borrowing is 'sweetened' to the creditor by the use of free shares or convertible warrants. This also causes dilution for long-term investors.

In this instance the creditor uses the shares/warrants to mitigate their loan risk and basically sell these in to the market. This selling causes the SP to drop or at least not to increase (based on progress news etc).

This is not manipulation per se (although it is potentially caused by one 'investor') but is the simple mechanics of how some AIM shares operator or need to operate in order to remain solvent.

cloud_dog

So, you post a rather vague, dare I say 'frothy' question, which a number of experienced posters are unable to decipher and then come back with...

Headancer wrote: »

Can we stick with the premise of the original question rather than froth.

For the "hard of understanding" as we appear to have mr Thicko contributing, ill rephrase.

Is anybody a member of a shareholder association where a PART of their investment has been affected by short selling ?

Numpty.

Reed_Richards

Headancer wrote: »

Is anybody a member of a shareholder association where a PART of their investment has been affected by short selling ?

You're a bit more explicit at the second attempt.

Short selling can bring down the share price temporarily only. So unless you panic and sell (or have an automated stop loss that does it for you) there is no permanent harm done, at least as far as I can see.

Old_Lifer

I think the Mr Thicko comment refers to me as I am old nowadays and not too familiar with with computers but I have been investing for over fifty years and have a sizeable investment portfolio.

Chino

Old_Lifer wrote: »

I think the Mr Thicko comment refers to me

No, I think the comment was aimed (no pun, etc.) at an earlier poster. All of which could have been avoided if the OP had been less vague and ambiguous to start with.

Afraid_of_Kittens

I once knew a person who put £500k in Halifax shares because the dividends paid out were so good. He went on a 3 month round the world holiday when he returned his shares had dropped in value by 90%. Flbbargasted we were upon hearing this and far too late to tell him to not put all his eggs in one basket.