Let's look at an example week so that I can describe a process. For this example, Mr. Villain wants to get rich through the publicly traded stock ScamFront Enterprises (SFE).
MONDAY: SFE stock is at $10/share, which is approximately stable for the season. Mr. V buys a ton of stocks and the price rises to $10.30.
TUESDAY: SFE is up now 3% for the week, putting it on investment watcher lists as "recent movers". Mr. V buys another crap ton of stocks and the price rises to $11. A bunch of other random people also bought in at $10.30.
WEDNESDAY: Trading information sites are listing SFE as 'up 10% this week' and 'hit a 52-week high.' Mr. V buys more stock at $11 and so do a bunch of random other people. Market closes with SFE at $12.
THURSDAY: Mr. V pulls the rug, selling most of his stocks at $12. This tanks the price to $11.01 which triggers the $11 investors to sell as well, dropping the price to $10.35 which causes the $10.30 investors to sell which drops the price to $10. Yahoo Investments reports that SFE is down 18% on the day.
FRIDAY: Mr. V sells his remaining shares
Having scared some investors into finding a less volatile stock, the price is now at $9.60. Mr. V rebuys all his previous shares but at a 40 cent discount.
When markets open on MONDAY and SFE gradually rebalances to $10/share, then Mr. V has made 4% ROI in a week at the expense of emotional daytraders.
You're serious? I don't want to type a whole big thing about market manipulation if you're joking.
Tl;Dr is that controlling the stocks influences the price, and they can recoup their "lost profit" with some clever trades.
Let's look at an example week so that I can describe a process. For this example, Mr. Villain wants to get rich through the publicly traded stock ScamFront Enterprises (SFE).
MONDAY: SFE stock is at $10/share, which is approximately stable for the season. Mr. V buys a ton of stocks and the price rises to $10.30.
TUESDAY: SFE is up now 3% for the week, putting it on investment watcher lists as "recent movers". Mr. V buys another crap ton of stocks and the price rises to $11. A bunch of other random people also bought in at $10.30.
WEDNESDAY: Trading information sites are listing SFE as 'up 10% this week' and 'hit a 52-week high.' Mr. V buys more stock at $11 and so do a bunch of random other people. Market closes with SFE at $12.
THURSDAY: Mr. V pulls the rug, selling most of his stocks at $12. This tanks the price to $11.01 which triggers the $11 investors to sell as well, dropping the price to $10.35 which causes the $10.30 investors to sell which drops the price to $10. Yahoo Investments reports that SFE is down 18% on the day.
FRIDAY: Mr. V sells his remaining shares Having scared some investors into finding a less volatile stock, the price is now at $9.60. Mr. V rebuys all his previous shares but at a 40 cent discount.
When markets open on MONDAY and SFE gradually rebalances to $10/share, then Mr. V has made 4% ROI in a week at the expense of emotional daytraders.