View more on these topics

FSA issues stock tips warning


The FSA has issued a warning to investors about the sources of thousand of stock tips that appear daily on internet bulletin boards.


The regulator has been quick to emphasise that the majority of such tips are likely to be genuine in nature.


But it has published an alert on its consumer website pages pointing out that unscrupulous individuals could post false information to take advantage of gullible punters.


The alert says: “There is potential for the unscrupulous to place false or misleading messages in order to make money for themselves”.


“Following such tips blindly can seriously damage your wealth. So the simple message is do not believe everything you read.”


Two kinds of scams specifically dealt with have been dubbed “pumping and dumping” and “trashing and cashing”.


The first involves people using bulletin boards to tout a company&#39s fortunes in the hope of persuading others to buy into the shares helping to raise the price. They then sell their stake in the venture earning a tidy profit in the process.


The second, which is exactly the opposite, involves the posting of false negative news about a company to convince other punters to sell off their shares.


When the stock price falls, the offender scoops them up at a bargain price, fully aware that when the rumours they started are proven false, the value of the stocks will correct themselves.


The warning is the latest of a FSA series aimed at helping the public understand the risks of investing over the internet.

Recommended

“Keep annuities simple” urges specialist

Pensions specialist Punter Southall is appealing to the Government to keep to new annuity rules simple in response to the DSS consultation paper on annuities.In the paper the Government proposes relaxing the rules for money purchase occupational schemes allowing their members to take advantage of investment linked and with-profit annuities.But the consulting actuary warn that […]

Working party boosts plan to scrap compulsory annuities for 75 year olds

The Retirement Income Working Party has added its weight to the campaign to scrap compulsory annuities for 75 year olds.In a report out next week, The Retirement Income Working Party argues only investors with total pension incomes of less than £140 a week should be forced to buy an annuity.Current legislation demands retiring investors must […]

US company to enter UK investment trusts market

Amerindo Investment Advisors Inc has announced plans to launch an investment trust in the UK.The fund will be the fund manager&#39s first presence in this country and will hit the market by March 15 at the latest.A minimum investment of £1,000 will be required to buy into the trust which will be available to both […]

Size matters, says AITC

Size matters, according to the AITC, which says bigger trusts offer less charges.Investment trusts between £10m and £20m charge on avergage1.4 per cent a year, comapred with those over £1bn which charge 0.36 per cent on average.AITC director general Daniel Godfrey says: “Large investment trusts are an incredibly efficient way of managing money. Lower charges […]

Newsletter

News and expert analysis straight to your inbox

Sign up

Comments

    Leave a comment