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Is it legal and ethical to deeply research a firm until you find very serious problems, then short their stock, then announce your findings? It feels... OK to
by lectrick 12y ago
Is it legal and ethical to deeply research a firm until you find very serious problems, then short their stock, then announce your findings?
It feels... OK to me. For some reason this strikes me as a surprising way to make money. Never heard of this before now.
- jldugger 12y agoIt's not only ethical, it's about the only reason short selling hasn't been outlawed.
- lectrick 12y agoDoesn't shorting also help stabilize the value of a security?
- thrillgore 12y agoIts definitely not insider trading. It's a reasonable expectation of research conducted in the public scope. It's also good investment work. You can get by with a prospectus and a Morningstar rating and call it a day, but if you're going to invest in anything in the immediate term you damn well better be ready to do your homework. One day its a blue chip. The next, its on 60 Minutes and your future is in jeopardy.