Abear raid is a type of stock market strategy, where a trader (or group of traders) attempts to force down the price of a stock to cover a short position. The name is derived from the common use of
bearorbearish in the language of market sentiment to reflect the idea that investors expect downward price movement.[1]
A bear raid can be done by spreading negative rumors or misinformation about the target firm,[2] which puts downward pressure on the share price. This is typically considered a form of securities fraud. Alternatively, traders could take on large short positions themselves, manipulating the price with the large volume of selling,[3] making the strategy self-perpetuating.
^Sayle, Murray (2001-04-05). "Japan goes Dutch". London Review of Books. 23 (7): 3–7. ISSN0260-9592. Retrieved 2017-11-01. ...Dutch market punters pioneered short selling, option trading, debt-equity swaps, merchant banking, unit trusts and other speculative instruments, much as we now know them. With them came specialised offshoots – insurance, retirement funds and other orderly forms of investment – and the maladies of capitalism: the boom-bust cycle, the world's first asset-inflation bubble, the tulip mania of 1636-37, and even, in 1607, history's first bear raider, a canny shareholder named Isaac le Maire who dumped his VOC stock, forcing the price down, and then bought it back at a discount.
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