DART 5-minute check — 3 ways to check disclosures to filter out strategic stocks

I know the term “operational stock,” but few individual investors know exactly how it works.

A company whose financial statements are sound but whose stock price moves strangely.

There is always a network behind it.

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Structure of Operations — Designed by Networks, Not Individuals

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Lee & Kim (SSRN) empirical:

Stock price manipulation is carried out by organized networks rather than single actors.

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Typical structure:

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① Planning stage

Major shareholders/executives + corporations scheduled to be acquired by CB + stock price boosting forces connected

- Network pre-configuration through corporation establishment and executive assignment

- External observation is almost impossible at this stage.

② Funding stage

Issuance of CB or BW (bonds with warrants)

- Acquired by an internally linked corporation → actual circulation of funds

- Debt increases in financial statements, but in reality it is retained internally

③ Stock price boost stage

False or exaggerated disclosures or IR activities

- Inflow of internal network buying power → Increase in trading volume and stock price

- Attracting inflow of individual investors

④ Conversion/sale stage

CB conversion → Bulk acquisition of stocks

- Sell when the stock price is at its peak or when individual buying forces are inflow.

- Simultaneous decrease in majority shareholders’ shares

⑤ Result

Stock prices plummet → losses for individual investors

- Dissolution of corporation or replacement of executives → Dilution of traces

- Incorporation into decommissioned or managed stocks

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What signal do you capture?

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Patterns that Relational Risk identifies as leading signals:

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CB acquisition corporation establishes relationships with major shareholders and executives

- The corporation has a short history of establishment (less than 3 years) and has a small amount of capital.

- The same executive is simultaneously registered in multiple small unlisted corporations

- There is a sharp increase in announcements of changes to executive positions before the stock price rises.

- Change in majority shareholders’ shares within 6 months after CB issuance

This is not in the financial statements.

It only exists in network data.

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Why do individuals always suffer

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Individual investors do not have the tools to view this network structure.

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DART disclosure is fragmented

- Executive history is dispersed in each company’s disclosures.

- The relationship between CB acquirer and majority shareholder requires manual connection.

RaymondsRisk has automated this connection.

3,109 companies × 49,446 executives × CB investor behavior.

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key message

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Operations are carried out by networks, not individuals.

By reading the network, you can find out about the game before it starts.

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■ Reference materials

Lee & Kim (SSRN): Demonstration of stock price manipulation and network design

- Heo Seo-young (2025): CB conversion event and minority shareholder loss

- Keum (2024): Private placement CB = red flag

- RaymondsRisk White Paper: https://www.konnect-ai.net/whitepaper

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