The more I'm "playing" the stock market, the more frustrating things I notice.
The latest one involves a company that I've been eying for some time...over a year now. In fact, I even owned it for a short while...but not recently.
Lately, the stock price was falling, and it was getting near a price that would make me want to pull the trigger and buy it...a lot of it.
The good news?
Fortunately, the company released a statement that they are really profitable.
The bad news?
They announced this RIGHT AFTER the market closed yesterday.
Logically, it seems like you would release good news at the beginning of the day and bad news toward the end of the day. People tend to overreact to the news. Releasing good news at the beginning of the day allows people to buy based on their new-found excitement. (Bad news, on the other hand, tends to be released LATER in the day to REDUCE the time for people to respond emotionally.)
So why would a company deliver GREAT news AFTER the market closes?
I can only put together two possible answers.
1. They really are stupid, and they are making an awesome profit only by a tremendous stroke of luck.
2. They are positioning a few people, who have the power to invest before and after the market closes to the public, to make a killing.
Given that the economy is not doing all that great right now, chances are not very good that a company "lucks out." (That does happen during the high points of economic cycles, by the way.)
Where does that leave us?
I can't think of any other reasons. Can you?
After market announcements tend to be manipulative, anyway. This just seems to be legally fraudulent.
Get your hands off that opportunity! That profit is for HIM to take (before the market reopens)--not for YOU!
Can anyone think of other possible reasons? I'm entirely open, and I'm really hoping that I'm overlooking something, because THIS is really frustrating to me!