These machines also played a big role in the fall of shares of Adani Group, Danadan sells shares: Vivek Bajaj
Are machines behind the sharp sell-off in Adani Group shares?
Social media personality Vivek Bajaj believes something similar. In a video released titled “Adani Adani Mat Khelo”, he told that a major role behind the sharp fall in Adani Group’s shares is Algo traders (HFT Algo) doing very fast trading.
HFT Algo runs on very powerful computers and can trade at lightning speed. For the last 4 or 5 years, the dominance of such algorithms is increasing in the market.
In the video, the co-founders of StockAge and Credent InfoAge talked about the sharp fall in Adani Group shares last week. A day ago, 7 shares of Adani Group were trading in the lower circuit.
In the video, Bajaj said that he is not speaking for or against Adani Group shares, instead, he is simply advising people not to fall into any narrative.
He said, “There are many Algo inside the market. They follow the prices very closely. When the prices fall beyond a level, these Algo start selling. They are not aware of anything else (such as fundamentals).” Don’t think. Then whether they are selling to Adani or someone else.. they just start selling when the price goes below a certain level (level fed through programming). When the Algo sells, then another Follows that, and then a third… In the end, it becomes a whole long series that engulfs the market. The deep declines you see in the market are the machines doing it. These sellers Humans are not.”
Bajaj said that when an exchange (National Stock Exchange) decided to put some (three) companies of the Adani Group on the additional watch list, it added to the negative sentiment in the market. “This led to selling in Adani and had a negative impact (resulting in higher selling in shares),” he said.
In fact, trading in the stock market through HFT Algo has grown rapidly in the last few years. Data released by NSE in December shows that about 54 percent of the total trade on the exchange is being done through Algo. On BSE this figure is 41 percent.
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