What is a Bear Raid?
The concept of a bear raid is based on the idea of combining resources to create a situation where the prices of various securities are driven down. Along with ethical concerns about efforts to artificially force down the price of securities, many countries have deemed the use of the bear raid as illegal. Here is some background on how the bear raid works, and what the anticipated benefits of such a strategy would entail. In order to attempt a bear raid, it is possible to either be a large trader, or to assemble a cartel of traders who will use their combined resources in unison. Once the resources are in place, a security will be identified as a viable project. The cartel will engage in a plan of aggressive short selling on the security, which in turn will begin the process of driving down the value of each share of the security. At the same time, it is not unusual for the cartel begin using word of mouth to create some degree of suspicion about the stability of the security. As the n
