Pump and dump definition

Pump and dump is illegal promotion of stock when the only purpose is to create buying excitement and to sell shares (that the person who starts Pump and dump buys in advance) into this buying excitement. Pump and dump used to be done mainly by phone, when brokers would cold-call "less sophisticated" investors and tell them "boy have I got a stock tip for you, but you have to act now...", something like that. Now it's mostly done over the Internet, by email spam, chatroom Pump and dump, that sort of thing.

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