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id: 640, Created by Stan Vick, Scout
Gaotu Techedu Inc (GSX) Manipulation Case
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On May 18, 2020, GSX Techedu was accused by independent short-seller Muddy Waters of manipulating its financial accounts. The MW report stated that at least ~70% of GSX's users were fake.
On this news, the $GSX price dropped, and many market participants reasonably made the decision to open short positions at fundamentally inflated price levels.
Market participants suspect that following the dramatic increase in short interest GSX Techedu allegedly conspired with some big market players, including the notorious Archegos, to manipulate prices causing a short squeeze.
The short squeeze caused $GSX share price to jump 200% by Autumn 2020, despite continued accusations of accounting shenanigans and related lawsuits against the Company.
Taking all facts into account, Short Seller Market Participants have reasons to suspect $GSX, its officers, and certain hedge funds of conspiracy for market manipulation.
Shock Event Date
18 May 2020