The time between something being posted on twitter significant enough to move the market and the market finding out that thing is not true would be small enough that the number of people who had been able to take advantage of such a price movement would be extremely small—and your trade timing would need to be perfect as well, because your cash out would need to occur prior to an event you cannot control which is it becoming apparent that the posts had been hacks or at the very least untrue. You should plan to move very quickly. Remember there are many alternative means of communication.
- Any head of state is communicating directly with the press at all times through their comms department and/or they themselves commanding the focus of the press.
- Any specific company targeted, as soon as the movement in their valuation occurred, would be able to blast out the truth via PR Newswire that the specific claims were untrue and the result of a hack.
I think in this case since the correction would occur so quickly the number of trades executed made by retail would be pretty easy to sift through, and you’d undergo heavy scrutiny, even if you had an established trading history that explained your position taking.
A retail investor would be very easy to catch, basically. On something like this, I’d imagine enforcement would be a federal priority. The data available to law enforcement on matters like this is voluminous and it would only be a matter of time. Lack of enforcement is usually just a resource constraint or low prioritization. You’d have to have a much more complex plan than just taking and exiting a market position.
The only conceptual framework I can fit the idea of getting away with hacking twitter accounts to move the market and successfully exiting would be an institution with billions of positions moving fluidly in a predetermined way to align with the information seeded by the twitter posts for a short period of time. But why would anyone do that right now when all the investment banks have close to record revenue? Just 5 months ago, investment banks were in a rough spot. Now they are raking in this market recovery with little effort. I don’t know why you’d expose yourself to prison for a one time gain that would be limited because the institution needs to it make it obvious this occurred so you cannot extract maximum return.