Indian stock market operator calls

January 13, by Rajat Sharma 17 Comments. At times this is market driven and prices rise and fall purely based on demand and supply; while on others, the price is made to behave that way.

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In the stock market, this is common place. Far too many spend their time, energy and brain in trying to defeat the market or shall I say — in trying to defraud others.

May be for this reason, many people look at the stock market as a place where only the well informed insider can make money. While I can assure you that nothing could be further from the truth, in this post I will stick to talking about how the so called operators go about their jobs.

Operator Syndicates There are many ways by which stock market operators try to make the share price move as they desire. Newer techniques to commit fraud are being devised everyday and even the well informed often fall for them. One of the most common ways in which stock market operator work is by forming a syndicate with each other and targeting companies where a big portion of promoter holding is pledged. Promoters of many midcap companies in India have pledged a large portion of their holding which gives these operators a target rich hunting ground.

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The objective is to short sell selling shares without actually holding them — i. More the price falls, higher the profit they make since they sell high and can buy back at a lower price hence netting the difference.

Further, a sharp fall in the price of the share does 2 things: Best explained with an example — The trader pledges shares worth Rs 50 and with the Rs 50 margin he so raises, he buys shares worth Rs Now if the price of his purchased shares declines to Rshe will have to deposit more shares or cash in his margin account, failing which, the lender will most likely sell the pledged shares to recover the money which he extended.

Stock market operators try to short sell to the point that the margin exposure taken by the promoter gets wiped out. Once this happens, a fresh round of sell-off gets triggered by the financier to recover his money.

This results in a further crash in the stock price. Often and not always this sharp decline in stock price has nothing to do with the fundamentals of a business and is driven purely by the demand-supply pressure being exerted on the stock.

On the contrary, avoid companies where the forex rollover rates forex.com have pledges a huge portion of their holding.

A company where the promoter trades with the money he raises by pledging his own holding is not worth your time. Visit here for a look at the previous bear cartel attacks and a list of companies which got affected.

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SharesStocksTrading Tagged: Rajat Sharma is a well known stock market analyst and commentator. He has covered Indian markets sub penny stocks with potential over a decade and is regarded for consistently identifying early stage investment opportunities.

Attorney by qualification, Rajat has done extensive work for improving corporate governance and disclosure standards.

By Dalip Singh on May 14, at 3: Excellent knowledge based and educative to someone like me,who trades but with not even half the knowledge and thus loses hard earned money. By Rajat Sharma on May 15, at 7: By Sarang on August 14, at 3: Due to limited knowledge of Stock Market, bought it in lower circuit…. By Rajat Sharma on August 14, at 6: Hi Sarang — Please post your questions in the member section after signing up on — http: By Sashank on September 24, at 4: Thank you very much for your valuable experience and insights.

Great education for people like us. By Rajat Sharma on September 24, at 6: By john on November 10, at 6: Now that I am leaving my job, I thought I will say this — most of out tips at btst are based on your recos.

By Rajat Sharma on November 10, at 9: That is the best comment I have received so far. Its time you share some profits with me. I wont say no to it!

By john Balani on November 21, at By Rajat Sharma on November 21, at 4: By Stock Picker on November 21, at Hi, Thanks for good post ,I got a good ideas from this article and found a few low brokerage companies. I have that on mind for a very long time but in general I feel that for serious investors and not tradersbrokerage is not a big issue really.

By Pankaj Mane on February 26, at 7: By Sujan on March 10, at 4: Do the manipulate big companies stocks too such as Infy, Reliance etc. By Rajat Sharma on March 10, at 5: Price manipulation is of course illegal. Bigger the company, harder it is to manipulate it but sure it happens. By Prathamesh Ak on November 3, at 5: But your post will hugely affect healthy competition in stock market.

By Rajat Sharma on November 4, at Home About Rajat Sharma Press Coverage Services Investment Advisory Investing Portfolio Blue Chip Stocks Mid Cap Stocks Multibagger Ideas Dividend Stocks Magnificent 7 Track Record Subscribe Open A Trading Account Free Zone BSE Sensex CNX Nifty BSE BSE Videos Blog Login Contact. Stock Market Operators-How Do They Do It? You May Also Like: Insider Trading and Stock tips in Indian Stock Markets How share prices change — Equilibrium Price How Are Stock Prices Determined?

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About the Author Rajat Sharma is a well known stock market analyst and commentator. I got your message on my inbox as well. Due to limited knowledge of Stock Market, bought it in lower circuit… Please guide me what to do!

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