One of the best performers on the local market this morning has been the Harvey Norman Holdings Limited (ASX: HVN) share price.
In morning trade the retailer's shares are up over 6% to $4.01.
Why are its shares higher?
After the market closed on Tuesday Harvey Norman released an announcement relating to concerns raised by ASIC regarding its financial report for the year ended June 30 2016.
Specifically, ASIC was looking into the company's accounts, the way it valued property, and its relationship with franchisees and whether they should be consolidated by Harvey Norman.
But according to yesterday's announcement, the corporate regulator does not intend to make further enquiries with Harvey Norman in relation to the matters raised.
Gerry Harvey told the News Limited press that he was very pleased with the outcome and restated his belief that market manipulators and short sellers were behind the accusations.
I believe that this explains the share price gain today. Short sellers that were expecting an ASIC investigation to drive its shares lower will have no doubt raced to close positions this morning, driving the share price higher.
Should you invest?
Although its shares are arguably dirt cheap and the ASIC drama is now over, I wouldn't be in a rush to invest in either Harvey Norman or rival JB Hi-Fi Limited (ASX: JBH).
With the much anticipated Amazon launch on the horizon, I would suggest investors stay clear of these retailers.
If Amazon has the same impact on the retail industry here as it did in the UK and United States, then these two retailers could have a real battle on their hands over the coming years.
In light of this, I don't believe the reward on offer is worth the risk.
