Stock Price Manipulation Model

The price manipulation appeared almost when the stock market was established, which has harassed the development of stock market. There are many papers on price manipulation being published in foreign countries, but less papers has been published in China.In my paper, I have given the definition of price manipulation and illustrate the history of price manipulation. And I take Yorkpoint Science and Technology as a typical case to analyze the price manipulation. On the analysis of the case, I divide the process of price manipulation into three parts:absorption, pump and dump. And the model is that it classifies the traders in the market into three parts:manipulator, value investor, trend-following investor. And then I set up 4 models:the model without price manipulation, the basic models of price manipulation and the other two model expanded. They show that:(1) in the world without price manipulation, the value investors earn more, and the earning of trend-following investor depends on the stop loss limit; (2)with price manipulation, the price manipulator’s profit depends on the trend-following investor’s.sensitivity on the growth of price; (3)the manipulators control the oscillation frequency which is only depends on the confidence of the trend-following investor’s on his strategy to enhance their profits; (4)for the trading-based price manipulation; manipulators can choose best volume to maximize their profits.Price manipulations are a hindrance to the development of stock market, Based on the properties of price manipulation, I put forward some suggestions.