Not a legal expert but surely if management behave in the way...

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OracleOfOmaha

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07/04/21

14:33

Post #: 52301855
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Originally posted by 1ronnie: ↑

Contrary to most who yearn for announcements , I actually dread company announcements especially when trading or investing in Microcaps during periods of positive exuberance. Why ? Because if the Microcaps are not worth the salt they're trading at , the cat is out of the bag when they release their 4C or poor announcements as the market tends to overshoot very much ahead of their actual outlook and fundamentals...And market participants suddenly awakens to a reality check, exuberance wanes and you see mass selling from traders with extreme positions.

Secondly , if company sp can only rise on announcements like a sugar fix, typically it does not sustain, unless the announcement is of material implication or a game changer. Short of that and especially if the announcements do not lead to a material change in outlook, you start wondering if the announcement was worth releasing at all,...which only leads one to think that management agenda is to stir interest and hope market will lead th stock higher...And I would be seriously concern with that sort of management...And there are a number of them on ASX amongst darling stocks....retail traders want sugar fix then use their technical charts to justify and persuade others that price will be going higher. And what about those management that could quietly accumulate at lower prices when interests waned and then when accumulated enough whips up an engineered announcement to shore up the share price...dumps when retailers got all excited....these management do not even have to run their business well, they get rich stirring up their own stock fortunes.

The best Microcaps go higher without need for regular and immaterial announcements because they run their business well and the proof is in the pudding when they release their results and outlook. An example is CXL (Calix).

When companies make immaterial announcement just to break the silence, those are the ones you need to be wary and cautious about.

Overhyped stocks that have enjoyed more than justified price gains make good candidates to sell before they release their 4C.

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Not a legal expert but surely if management behave in the way you described would that classify as insider trading or front-running which are presumably illegal?

Guess it's a naive question but wouldn't the illegality deter this kind of behaviour?
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0 Great analysis

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