- InTrade CEO John Delaney has conducted an investigation on the alleged manipulation. The suspicious moves in prices were in fact caused by the buying and selling made by an “institutional” trader (a hedge fund, I presume) who has been managing “certain risks” (hedging).
- Jason Ruspini, who wrote before this report came out, does believe that manipulations “non-informational” trades have been prevalent on InTrade. (We will see whether Jason changes his mind in light of InTrade’s debunking report.)
I never said that it was manipulation, just that it seemed “non-informational”.. which is fine. Hedging is non-informational.
The thought had crossed my mind that it was related to a company like Centrist, but I would have thought their hedging operations would be more gentle to the market. Maybe they have a break on commissions so they can afford to be price-takers.
Told you, it’s common. Even in highly liquified mature markets.
What people should be focusing on when they suspect manipulation, is whether someone is spreading rumors or false information. Can’t see any other way to make it work.
Anyone who wants to purchase massive amount of shares in a relatively illiquid market is going to have to move the price. There is no easy easy way to do it. If you try, it will sometimes turn out to be more expensive.
I do not know what the optimal acquiring rate is, but if it’s too slow people will start to follow you.
Jason, I have corrected the term.