Shares/Stock 6 Characteristics of Fried Stocks

Suba

Moderator
Staff member
What Are Fried Stocks?
Fried stocks are stocks whose fundamentals are not good or bad, but the price has been manipulated by market participants (stock dealers) to get short-term profits.

Often fried stocks will harm retail investors and novice investors by up to tens of percent, there is also the possibility that fried stocks will be frozen from trading, so investors cannot resell stocks.

The risk of fried stocks is very high so it is not recommended for novice investors, so fried stocks will be more suitable for professional investors who are experienced and understand the stock market well.

Fried Stock Characteristics
The ability of a stock dealer is increasing and technology is getting more sophisticated, so that the longer it takes, the more difficult it will be to recognize fried stocks. So that novice investors are not trapped by fried stocks, investors should know the 7 characteristics of fried stocks as follows:

In order not to be fooled into buying this kind of fried stock, you should learn how to know what fried stock is. Because according to some news, its characteristics are increasingly difficult to identify. Here are 7 characteristics of fried stocks that stock investors need to know:

1. Price Increase Is Big Enough
Significant price increase in a short period of time. If you see a price increase of more than 10% or near the Daily Biggest Limit, for two days in a row then you can be sure that the stock has been fried by the dealer.

2. Unreasonable bids and offers
Fried stocks usually have a very large volume and number of transactions. However, the position of both bid and offer shares is not evenly distributed.

3. Inappropriate Trading Volume
Most fried stocks come from second-tier and third-tier stocks, so often the trading volume of fried stocks is greater than the stock layers above. Not because there is a high demand but because it is being manipulated by the stock dealers. The stock dealer buys fried stock in large quantities, so the stock price will rise drastically. When the price reaches the desired level, the stock dealer will immediately sell the stock, so the stock price will drop.

4. Controlled By New Issuer
Stock prices are usually affordable, but you need to be aware of the emergence of new issuers. Usually they are often referred to as fried stock because the price is still quite cheap.

5. High Stock Prices Even though the Company is Losing
Fried stock is a trap, showing high stock prices, even though the company's finances are not healthy or the company is at a loss. The high stock price is a manipulation that is supported by large capital provided by the stock market, because it is very important to monitor and analyze the company's financial statements before buying shares.

6. Very difficult to analyze
Financial performance that does not match the stock price, fried stock is very difficult to analyze, because the financial ratios and their valuation are much higher than competitors.
 

Mika

VIP Contributor
Never heard of the term Fried Stocks but based on what I have read here I think I exactly understand what Fried Stocks really are. I am a stock market investor (a small investor) and recognizing Fried Stocks and knowing how to avoid them is very important for me. I have been in the stock market for 5 years. Based on my experience, I am going to share some important tips regarding how to recognize market manipulation, and how to avoid getting trapped in the manipulated market.

When you are investing in stocks, you will have to see how the company is actually doing in the market. Is the company making profits, what is the yearly turnover, and how many products/units it is selling every day/week/month/year? What is the market size of the company? Who are the competitors of this company, and how these companies are doing in the market and the stock market? If market performance does not match with stock performance, the stocks are manipulated.
 
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