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One fraudulent strategy that speculators engaged in was "pump and dump," where they would artificially inflate the price of a low-value stock by spreading false or misleading information. Once the stock price surged due to increased demand from unsuspecting investors, the speculators would sell their shares at the inflated price, leading to significant losses for those who bought in. This practice is illegal and undermines market integrity, often resulting in severe penalties for those involved.

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1mo ago

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