Portfolio Pumping

Portfolio Pumping
The illegal act of bidding up the value of a fund's holdings right before the end of a quarter, when the fund's performance is measured. This is done by placing a large number of orders on existing holdings, which drives up the value of the fund.

Also known as "marking the close".

Portfolio pumping can be highly destructive for investors in the fund because it is a temporary gain and the stocks will generally fall back to previous levels once the price manipulation is over. For example, if a fund has 1,000 shares of ABC purchased for $10 per share, if the shares are trading at $9 right before the managers’ performance is measured, they will have performed poorly. As a result, the managers may resort to portfolio pumping and place enough orders to bid the price to $14, dramatically increasing the fund’s performance. However, it is likely that the shares will fall back towards $9, leaving investors with a $9 stock that was made to look like a $14 stock.


Investment dictionary. . 2012.

Игры ⚽ Нужен реферат?

Look at other dictionaries:

  • Frank Mohn — Infobox Company | company name = Frank Mohn AS company type = Private company company slogan = foundation = 1938 location = Helldal, Norway key people = Trond Mohn (CEO) Gunnar Grette (Chairman) num employees = 1,232 industry = Oil pumps products …   Wikipedia

  • ECONOMIC AFFAIRS — THE PRE MANDATE (LATE OTTOMAN) PERIOD Geography and Borders In September 1923 a new political entity was formally recognized by the international community. Palestine, or Ereẓ Israel as Jews have continued to refer to it for 2,000 years,… …   Encyclopedia of Judaism

  • Economy of Mexico — Going clockwise and starting from the upper left image: Port of Veracruz, Puerta de Hierro in Guadalajara Business District, Mastretta MXT automobile by Mexican automaker Mastretta, Pemex Oil platform in the …   Wikipedia

  • Gasoline and diesel usage and pricing — For information on the price of oil, see price of petroleum. The usage and pricing of gasoline (petrol) results from factors as crude oil prices, processing and distribution costs, local demand, the strength of local currencies, and the… …   Wikipedia

  • Solar thermal energy — Solar thermal system for water heating in Santorini, Greece …   Wikipedia

  • Hot dry rock geothermal energy — (HDR) is a type of geothermal power production that uses the very high temperatures (approx 200 Celsius) that can be found in rocks a few kilometers below ground. Electricity is generated by pumping high pressure water down a borehole (injection… …   Wikipedia

  • Бизнес-карьера Арнольда Шварценеггера — Эту статью следует викифицировать. Пожалуйста, оформите её согласно правилам оформления статей …   Википедия

  • Pacific Gas and Electric Company — For the 1970s rock music band, see Pacific Gas Electric (band). : PG E redirects here. For the Portland, Oregon electric utility, see Portland General Electric. Infobox Company company name = Pacific Gas and Electric Company company company type …   Wikipedia

  • Economic Affairs — ▪ 2006 Introduction In 2005 rising U.S. deficits, tight monetary policies, and higher oil prices triggered by hurricane damage in the Gulf of Mexico were moderating influences on the world economy and on U.S. stock markets, but some other… …   Universalium

  • Polycrystalline silicon — Polycrystalline silicon, also called polysilicon, is a material consisting of small silicon crystals. It differs from single crystal silicon, used for electronics and solar cells, and from amorphous silicon, used for thin film devices and solar… …   Wikipedia

Share the article and excerpts

Direct link
… Do a right-click on the link above
and select “Copy Link”