please tell me how can the big boys (as you call it ) do this? every one can buy this stock if they see it is worth the money. I bought and sold it twice this week to make a nice profit both times . and hope I can continue to to this in the future
What they do is call is short and distort the stock. They by having someone write a bearish or negative article about the target companies or stock. This article normally pick up by bloggers and media internet portals who start blasting different version of it all over the net. They also start crash message boards with more negative posts. One will support the other to try to give credibility to the process. The may send emails to analysts and /or to get them to write more negative articles. some may even send false and misleading information to reports, especially if the the is in a bear market.
You have to do your due diligence on these report and the persons doing them. For example, Andrew Bary of Barron's is a history major/reporter. I don't think he is actually an analyst. He think that VZ should be worth $100 a share and FB no more than $25 a share. These are just opinions on valuation and price targets. People did not blast the VZ story all over the net but shorts blast the FB story because they stood to gain from a decrease in its stock ( short or put option positions).
Not to mix apples with oranges here. VZ is very labor intensive while FB is not. The evaluations of both would therefore be different. FB could monetize its sites with very little capital outlay. It is also in the beginning of its marketing/business cycles. It has not reached maturity in its effort to monetize over 1.1 billion users. Markets are looking at ways to tap into these households without being to intrusive. FB only needs to get about $100 per person of 300 million users. I see this as being possible long-term. The market is looking for the company to leverage its free service. There are already companies doing this and they trade at very high. One company I know is growing revenue at almost 100 percent yoy.
That's how the big boy's make $$$. They trash it, then consume it, then dump it. Then they repeat that process over and over again. Stock will not make a steady run up until Zuck creates "real" value outside of the advertising business. IM will not be all in until that happens, and that time is coming. You will be able to buy FB real cheap if we ever have that all anticipated correction. After that you can sit back wait a couple of years and at least triple your $$$.