Legal Definitions - rigging the market

Definition: Rigging the market is the illegal practice of artificially inflating stock prices by creating the appearance of high demand through a series of bids. This entices investors to buy the stocks, leading to an increase in their prices.

Example: A group of investors collude to buy a large number of shares of a particular stock, creating the impression of high demand. This causes the stock price to rise, and other investors are attracted to buy the stock, further driving up the price. Once the price reaches a certain level, the group of investors sells their shares, making a profit while leaving other investors with overpriced stocks.

This example illustrates how rigging the market can be used to manipulate stock prices for personal gain, at the expense of other investors.