Matt Levine’s Money Stuff: Be Careful Tweeting About Stocks

Pump and dump

Here is a hypothetical:

1. You like to trade stocks, and you are active on social media. “Nothing here is investment advice,” you say, at the top of all your social media feeds.
2. You come across a stock called XYZ. You open up its most recent annual report and read the first paragraph. “We are the leading manufacturer of widgets in Ruritania,” it says. It hooks you. “This company looks cool,” you think.
3. You go to your brokerage app and buy 1,000 shares of XYZ.
4. You tweet : “Just bought 1,000 shares of XYZ. This company looks cool! ...