Market manipulation

What it means

Transactions or information intended to distort prices or artificially inflate trading volume, in order to mislead other participants.

The exam angle

Split into information-based and transaction-based. Intent is what is examined, and it is usually established by what the person expected to happen.

Where it appears in the syllabus

• Ethical & Professional StandardsCFA Level I · exam weight 10–15% · The Code, the seven Standards, and how examiners phrase violations.
• Ethical & Professional StandardsCFA Level II · exam weight 10–15% · The same Standards, applied to dense vignettes with competing duties.

Related terms

• Code of EthicsThe aspirational statement of how members and candidates should conduct themselves.
• Diligence and reasonable basisThe requirement that any recommendation or action rest on adequate research and analysis that could be defended if…
• Fair dealingTreating all clients fairly when disseminating recommendations or taking investment action.
• Front-runningTrading ahead of a client order to benefit from the price move that order will cause.
• Independence and objectivityThe requirement to use reasonable care and judgement to keep independence, and to refuse any gift or pressure that…
• Loyalty to employerThe duty to act for the employer’s benefit, not to deprive it of your skills, and not to divulge confidential…