Legal Definitions - cornering the market

Definition: Cornering the market is the act of acquiring a significant portion of the available supply of a commodity or security, which allows the owner to manipulate the price of the commodity or security.

Example: If a person or a group of people buy up all the available supply of a particular stock, they can control the price of that stock. They can then sell the stock at a higher price, making a profit. This is known as cornering the market.

Explanation: When a person or a group of people buy up a significant portion of a commodity or security, they can create an artificial scarcity of that commodity or security. This can cause the price of the commodity or security to rise, allowing the owner to sell it at a higher price and make a profit. This practice is illegal in most countries because it can harm other investors and disrupt the market.