Predatory trading: ethics judgments, legality judgments and investment intentions

Purpose Predatory trading is a stock market technique in which certain participants exploit information about other participants' need to trade. often harms others. Hence, this paper examines the determinants and effects of financial practitioners' lay people's judgments predatory trading. Specifically, it investigates how public availability reliability exploited affect their ethics legality latter influence behavioral intentions regulation support. Design/methodology/approach The authors conducted two scenario judgment studies. In first study, were practitioners, second – people. Findings Practitioners judge be ethical. people incorporate but tend discount legal criterion. Lay justify using harm, or profit maximization principles. Practitioners' engage let fund managers invest money depend on judgments, Originality/value This explore It highlights that despite harm involves, practitioners Although law tends lag behind innovation, base hence also interpretation regulation. reveals dark aspect relationship between judgments.