Spammers manipulate markets

Spam messages that tout stocks and shares can have real effects on the markets, a study suggests.E-mails typically promote penny shares in the hope of convincing people to buy into a company to raise its price. People who respond to the "pump and dump" scam can lose 8% of their investment in two days.

Conversely, the spammers who buy low-priced stock before sending the e-mails, typically see a return of between 4.9% and 6% when they sell.

The study recently published on the Social Science Research Network say their conclusions prove the hypothesis that spammers "buy low and spam high".

The researchers say that approximately 730 million spam e-mails are sent every week, 15% of which tout stocks. Other estimates of spam volumes are far higher.

The study, by Professor Laura Frieder of Purdue University in the US and Professor Jonathan Zittrain from Oxford University's Internet Institute in the UK, analysed more than 75,000 unsolicited e-mails. sent between January 2004 and July 2005.

http://news.bbc.co.uk/2/hi/technology/5284618.stm