The sock of GaotuTechedu Inc. (GOTU) slightly increased in the Pre-market. The increase was insignificant. At the end of the last trading session, the stock closed at $2.42. The value of the stock in the Pre-market is $2.48 gaining 2.48%. The average volume of the stock traded in the last trading session was around 8.50 million.
3 Tiny Stocks Primed to Explode
The world's greatest investor — Warren Buffett — has a simple formula for making big money in the markets. He buys up valuable assets when they are very cheap. For stock market investors that means buying up cheap small cap stocks like these with huge upside potential.
We've set up an alert service to help smart investors take full advantage of the small cap stocks primed for big returns.
Click here for full details and to join for free
Sponsored
Reasons for the stock gain
The gain in the stock is not quite significant in fact from the past few months the stock of GaotuTechedu Inc. (GOTU) is on a continuous decline. A law firm has filed a Securities Class Action Lawsuit Against Goldman Sachs Group, Inc. and Morgan Stanley for securities law violations related to trading in the shares of GaotuTechedu Inc. (GOTU) from March 22, 2021, through March 29, 2021, on behalf of the investors. The class action litigation has been filed by the law firm of LieffCabraserHeimann& Bernstein, LLP.
The background of the whole scenario
Goldman Sachs Group Inc. and Morgan Stanley traded in GaotuTechedu Inc. (GOTU) ADSs while in possession of material non-public information that ArchegosCapital Managementhaving $10 billion under management, failed or they knew they were going to fail to make a margin call. This made them fully liquidate its entire shares in Gaotu.
As a result of these insider sales Goldman Sachs Group Inc. and Morgan Stanley saved billions of dollars in losses. They did a large number of trades consisting of shares to settleArchegos’sloss. That includes billions of dollars worth of Gaotu securities starting on March 25, 2021. They were careless in not knowing that they were not permitted to trade while possessing material, non-public data about Archegos. But they still sold their Gaotu shares in any case before the news about Archegos’ breakdown was public and the value of Gaotu shares plunged in the market.
During multi-week in March 22, 2021, to March 29, 2021, investment banks Goldman Sachs and Morgan Stanley trade on insider trade data by selling a huge number of GOTU stock dependent on then publically undisclosed data got through their situation with disturbed multi-billion dollar Archegos Capital Management.
Effect on the GOTU stock
Due to this, shares of GaotuTechedu Inc. stock fell over 60% during that week of March. The investors kept on losing money on their GaotuTechedu Inc. (GOTU) shares. On March 21 the price of the stock was around $83 and as of today, the stock is valued at $2.48 in the Pre-market.
Conclusion
This is a very complicated issue and the defendants will have to steal the loss of GaotuTechedu Inc. (GOTU) if found guilty. They were not allowed to trade in such a huge amount which they did.
