Dangers 'Smart Money' And Thin Markets

What Could Go Wrong?
I hope nothing.
The late December equity markets produced relatively light volume.
Below is a racetrack lesson on a not particularly distinguished bunch of horses registered for an unimportant race.
Late in the betting period there is a sudden surge in betting on a specific horse for no apparent reason. The chatter in the grandstand is that it was caused by external bookmakers balancing their betting exposure on a given horse. The presumption being that the clients of the bookmakers “knew” something that improved its probabilities. This surge was labeled “smart money” by those at the track. Sometimes, but not always, the chosen bet wins.