The Impact of Manipulation in Internet Stock Message Boards

This work analyses the impact of manipulation in internet stock message boards on nancial markets. Past research has demonstrated that messages posted in such boards could be used to predict price return and activity. It is therefore not surprising that people try to use such forums to inuence other users to act in a particular way. We focus on posts moderated as manipulative due to ramping. We nd that ramping occurs irrespective of moderation. We show that ramping is positively related to market returns, volatility and volume. We also demonstrate that rms with higher volume, lower price level, lower market capitalization and higher volatility receive a higher proportion of ramping posts. Furthermore, particular sectors (such as Health Care and Energy) are more common targets of ramping.