Holding down the share price
in response to
by
posted on
Jun 06, 2015 08:16AM
If only someone could explain to me how this mysterious "holding down the share price" works, how "they" are doing it and who "they" are!
In order to hold down the share price you would have to place considerable amounts of shares for sale at the price you want to cap it at, or you have to directly sell into the bid.
Okay, you could try to argue that the company is holding back positive news. Well, I can't rule that out. Perhaps one or more of the milestones have already been achieved. Perhaps partnership negotiations have proceeded well. Perhaps other advances have been made.
If those news have not yet been published, the reason for not doing so is not to hold down the share price, because that would be illegal. However, holding back information due to valid business reasons (see "stealth mode") is a very different story and could well be okay, depending on the circumstances. Sure, the share price would not rise in such a scenario. However, this would not be the original intention but merely a side-effect.
Bottom line: In my opinion all this talk about actively holding down the share price is nothing but a conspiracy theory.
However, I am willing to learn. So if you have a compelling explanation of how that holding down the share price would work, my ears are wide open. Thank you.