Understanding Stock Bashers: Protecting Yourself as an Investor

As a stock investor, you will be exposed to many different lingo terms in the financial industry. One such term that you may hear is the "stock basher." Here are the basics of the stock basher, and what it could mean to you as an investor.

Stock Basher

A stock basher is someone who attempts to lower the value of a stock with unscrupulous practices. They could be working alone, or at the request of another party. However, their main goal is to try and lower the price of a stock. This is typically accomplished by spreading lies and rumors about a particular company. They try to create fear surrounding company and lower the price of the stock. Then, they purchase the stock at a lower price.

In this way, the stock basher can make money on their purchase because the price of the stock will rebound to where it should have been. In the United States, this is an illegal practice and should be avoided at all costs. The SEC wants the market to decide the price of the stocks and not a collection of lies or false rumors. Therefore, if you are caught doing this, you could be subject to some stiff penalties or fines.