UPDATE 2: as of 3pm EST the SEC is now investing the iReport.com article authored by “johntw”. Have fun sweating bullets johntw! I hear Mexico is a wonderful place to escape to this time of year…
UPDATE: as of 11am EST the story on iReport.com has been removed. Instead of offering a retraction of the story and leaving it available for people to review, iReport.com is covering up the fact that it carried a patently false story. Way to go iReport.com… journalism at its finest. See the original article at the end of this post.
Citizen Journalism? More like another tool for stock market manipulation.
When the unfounded report by user johntw on iReport.com, CNN’s citizen journalism site, Put options (makes money when a stock falls) on Apple’s stock rocketed up in price.
I received a news alert at 9:44 EDT that Steve Jobs had allegedly suffered a major heart attack. I immediately started watching AAPL Put options, +QAAVR in particular. Within a span of 10 minutes it moved from 2.85 per share, to 6.25, then back to 2.90.
Someone, say johntw for instance, the author of this heart attack “report”, bought some Apple put options just before publishing the report.
Options contracts are purchased (usually) in sets of 100, thus someone buying 1 option would pay 2.85 x 100 = $285. 5 minutes later, each one of these contracts would have been worth $625 each. More than 2x your money.
Not a bad way to make some quick cash, kill the reputation of iReport.com, and generate a lot of negative publicity iReport.com and CNN.com (the parent company).
Here’s my prediction of the day: iReport.com will be dead due to zero credibility and constant manipulation for personal gains.
Original story removed by iReport.com:
(thanks to Silicon Alley Insider for taking a screenshot of the disgraceful post at iReport.com)
A special note for johntw, the “author” of this iReport article: I hope you weren’t stupid enough to post this for purposes of profiting from market manipulation. It wouldn’t be difficult for the SEC to subpoena iReport.com for server logs to determine your IP address, ISP, your physical location, your identity, and records from any trading accounts you own. Or they could simply match up unusual equities/derivatives transactions made before and after the article was published and apply some heat.
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