I came across a video which gives an example of stop loss hunting happening in Bank Nifty. They mention about institutional players being involved but it being not possible to prove. Given that Bank Nifty contains stocks with very high market caps, wouldn’t it require a lot of money/stock holdings to move the whole index in one go? Also, if these institutional players are repeatably doing something like this, wouldn’t such things get flagged by exchanges/SEBI? The video mentions that institutional investors might be doing this so as to increase the volatility and then sell options to profit from it. But if they are doing something like this, wouldn’t this be similar to the recent Biocon stock manipulation case (aka manipulating prices in the cash market to profit in the F&O market)?
