Featured, Market Watch

NTC Shares: Domino Effect & Herd Nature

Published by Octron on September 7, 2008

Rise and Fall of NTC shares is making news all around the country, media and papers. But hardly does anyone justify the reason behind it. Everyone just speculates. Here is one of the major reason for the recent sharp fall of share prices of NTC.

01 Sept 2008: The day when fate of NTC shares changed its track and COURTESY BROKER NO. 19. Who immediately, sold his clients shares for ~1300, when market had risen to 1481. What was his/her intention for selling those shares at such low price when market was booming ?

Snippet of FLOOR SHEET of 01 september 2008 (NTC Shares Trading)

NTC trading floor sheet - 01 sept 2008

Click here to see enlarged version

Possible reasons;

1. Heavy supply of sellers shares or Huge numbers of shares that needed to be sold by few big players (who bought it for 800 – 900).

2. Broker on his behalf wanted to turn the course of market for his own unkown interest. Yes, in Nepal its not just DEMAND/SUPPLY factor which works, but also Brokers wish that accounts. Remember recent NIB case where price dropped immediately 1000 in just one day. There was just one transaction.

3. Some market breakers have intentionally played the game to take over the serps. It will be bit hard to explain this, I will cover this matter seperately in coming days.

So, where were we ?

01 Sept 2008,

It was not just one transaction, despite other brokers maintaining sale of the shares at 1370, Broker no. 19 started pulling the game by lowering the price;
1300, 1270, 1240, 1213 and finally 1212 ….

As soon as people saw the price hitting bottom, as herd nature people started getting off their shares at any price they get inorder to save themselves from loss. (those who bought above 1000).

Then came 02 sept. As soon as market started the prices dipped…, As more and more people wanted to sell and very less people were there to buy such tainted shares. Finally, the price chrashed for circuit break 1092.

Now the second batch of buyer who bought shares at 800 – 900 wants to get their shares off …

Will they be able to ?

So, you can clearly see domino affect started by Broker 19 which is causing whole fall down of share prices of NTC.

Did you ask, how low it might go ?

Only time can say, but so far as my understanding goes it will hit 700 – 800 mark very soon.

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