Chatting About Stocks: Listed Companies "Following Trends" Hurts Others and Doesn't Help Themselves

Yingji Xin and Yahui Long were both fined for riding the hype of brain-computer interface hot topics, once again sounding the alarm for listed companies’ compliance disclosures. The purpose of “riding the hype” by listed companies is nothing more than to inflate stock prices and market value. However, under strict regulatory oversight, “riding the hype” has become a key illegal and irregular behavior targeted by regulators. Once a company is investigated and filed, its stock price faces pressure, and investors may suffer losses—an act that harms others without benefiting oneself.

“Riding the hype” involves some listed companies exploiting popular market concepts, exaggerating business relationships, and obscuring risk warnings in their disclosures to attract funds and boost stock prices. Their motivation is not based on genuine operations or long-term value but on short-term stock price increases. This behavior directly violates the fundamental principles of truthful, accurate, complete, and timely information disclosure, undermining the fairness and credibility of the capital market.

In the current environment of strict regulation, “riding the hype” is no longer a regulatory blind spot but a focus of rectification. Authorities maintain a high-pressure stance against misleading statements, false disclosures, and selective information disclosure. If a company is subjected to regulatory measures or investigation for “riding the hype,” it will face administrative penalties and reputational damage. The more immediate consequence is downward pressure on its stock price. Investors misled into buying may suffer losses, and the company’s market value may not only fail to sustain but also experience greater volatility.

From the perspective of the company’s own development, “riding the hype” is also counterproductive. The value of a listed company ultimately depends on its core business competitiveness, R&D investment, profitability, and sustainable operations. Focusing on concepts and themes weakens attention to the main business, neglects internal governance and risk control. Short-term stock price increases cannot translate into long-term competitiveness and may cause the company to lose the trust of professional investors and long-term capital, negatively impacting future financing, business cooperation, and market reputation.

Moreover, if a listed company is investigated and penalized by the CSRC, it may also face investor claims. According to lawyer Xu Feng, director of Shanghai Jiucheng Law Firm, investors who bought Yahui Long stock between January 7 and February 7, 2026, and sold or continued holding after February 7, currently have the right to initiate claims.

It is especially important to note that “riding the hype” can induce some investors to chase short-term themes while ignoring the company’s fundamentals, exacerbating market irrational fluctuations. When the hype subsides and the truth emerges, most of the damage falls on ordinary investors. A listed company’s illegal “riding the hype” harms the interests of a group of investors and erodes the trust foundation of the entire market.

For listed companies, compliance is the bottom line, and value is the right path. The core of market value management is to enhance intrinsic value, not to manipulate market expectations. Directors, supervisors, and senior management should diligently fulfill their responsibilities, eliminate complacency, avoid releasing hype-related information without substantive business support, and refrain from selective disclosures that could easily mislead the market. They should truly be responsible to the market, investors, and the company’s long-term development.

Regulatory authorities’ high-pressure oversight can create a sustained deterrent against “riding the hype” behaviors. Only by making the cost of violations significantly higher than the benefits can the impulse for listed companies to “ride the hype” be fundamentally curbed.

Beijing Business Daily Commentator Zhou Kejing