A completely hypothetical question, because there are many practical hurdles, less equity participation, less capital, independent fragmented traders, limited free float etc. But still do you think Indian retail can do something like that or do you think it cannot happen even in a million years.
Cannot happen as we have daily circuit limits whereas in US it doesn’t also they can short cash market but we can’t (though we have SLB but its very expensive and not easy )
No no, I am not talking about such things, if all things are the same, would such a scenario happen, can retail traders join forces and do that?
The question is more of a psychological one.
Don’t know but something similar happened during pandemic 2020 when crude oil futures went into negative. Somone told me they banned puts for a while
Was retail responsible for this? Ordinary investors did this?
It happens frequently with Adani Group stocks.
What do you mean? You mean retail are taking the price higher?
I think so looking at their shareholding patterns. Public holdings are increasing
It happens all the time with penny stocks, tips are circulated people bought the stock, price raised to almost 50-100% in few weeks ,now lower circuit is hitting, trapping every one.
GGPL,GKP, SHUBHAM. There is an active thread by people who are trapped
Even it happens with stocks in news like IPO or some famous personal buying or news
This is not new, it happens in many stocks, even with big names. Sometimes retail frenzy takes the price to heights like Adani stocks and sometimes the price does not move like ITC.
Gamestop was different, it was like a challenge, a competition.
I am not talking about this, this always happens, greedy or innocent investors always get trapped. I am talking about taking a bet against fund houses vs
We don’t have hedge funds like in US .In india hedge funds runs like AIF 3 funds with many regulations.Also , holding pattern of individual or funds relased quarterly.Also , when buying any stock more than certain quantity 1% requires regulatory approvals.
You need to understand gamestop saga why did it happend at first place.Its all because certain hedgefund have shorted 120% of entire holdings so that lead to short covering and buying from retailers at the same time.
As ,i mentioned we cannot short the stock and circuit limit because of this reason it cannot happen.
And , to your hypothetical question on Psychology well, i have travelled more than 25 countries and have worked/friends with many nationalities ,one thing for sure is humans everywhere are same.They have greed,fear,emotionals,hunger,family,friends everthing is more or less some just we are culturely different and imaginary boundaries called countries. So ,in Psychology terms we also have same tools so this can happen anywhere.
If you talk about challenge, something similar happened in 90s, although not by retailers. Manu Manik, the famous bear dared to short Reliance. Dheerubhai stepped in and taught him a lesson by bringing him on road. Nobody knows about his whereabouts after that.
I am interested in the hypothetical, can it happen in India scenario. I know that there exist a lot of difference between India an US, market size, regulations, participation, capital, research, interest all are different.
Indian psychology is different, we live in 21st century as with everyone else but still do a lot of things differently, so my question in regarding this aspect.
I did not know about this, never heard of this incident. This, if it has happened as you said, provides some base to Gamestop scenario question. Also, things have changed a lot since then, this has to be considered too.
Check this to know about Manu Manek
What do you think with respect to trading and investment Psychology we do different? More than US, i think we indians follow Mrs Dow Jones more:rofl:, we probably must have read about Warren buffet thoeries, US politics and dynamics (youtube ,social media is full of that) even all the text on derivative trading and investing are taken from European or US markets or inspired from. One thing i can say we are more Conservative savers than other countries all because of counterintuitive more interest rates which indirectly leads us to save as we have higher fixed income instuments returns but as you said if interest rate equals US ,i don’t think anything else makes us any different trader or investor.We even followed same index trajectory as Dow jone or nasdaq
To follow someone or something is different and behaving and living like them is different. Even among ourselves, Indians are separate, as the saying goes, unity in diversity. So my point is that, will investors or traders from different states, different cultures, different social setups unite and do something with one unified goal?
I think they’re already United on this forum and doing the common task of trying to help each other with their little knowledge.