![]() The Nifty-50 index is almost imitating the buy-sell trend of FPI/FII’s. Hence, the Nifty-50 fell from 5137 to 2763 points (market crashed by -46%). Between this period, the FIIs, FPIs, and DIIs have mainly been selling. A blue bars below the zero line indicates net selling. Let’s check the purchase/sale trend of FIIs, FPIs, and DIIs between Jan’08 and Feb’09 as a chart. The FIIs, FPIs and DIIs net selling was in the tune of Rs.13,032 Crore. When net purchase goes in negative, it means that the FIIs, FPIs and DIIs are in a selling mode. Net Purchase means the sum of gross purchase and gross sales of equity. Remember, this was the time of the market crash of 2008-09 due to the sub-prime mortgage crisis. The Nifty-50 fell from 5137 points to 2,763 points between Jan’08 and Feb’09 because FIIs and DIIs were selling their holdings. FPI/FII Net Investment (buy vs sell trades) and Nifty50 Index Let me show you a graphical representation of how the Index moves when FPI/FIIs are investing. Hence, the index is little impacted by their activity. When FPI/FIIs are selling, the index falls and vice versa.Ĭompared to FII/FPI/DII, the trading volume of individual retail investors is negligible. Hence, their trading activity is most visible on the index. FPIs and FIIs pump in and pull out the most amount of money. If they are selling, the index will fall. If they are buying in the stock market, the index will move up. Stock market investments are dominated by three players, FPI, FII, and DII. Apart from the above three types of investors, there are other investors who are classified as Retail Investors. Sorry for the jargon, but these are types of investors who invest in the Indian Financial System. Influence of FPI, FII & DII on Stock Price (Index) #2.3 Two methods to predict stock price.#2.2 Correlation between reports, fundamentals & fair price.It is a complex puzzle, and for common men like us, it is a hard nut to crack. It not only depends on the fundamentals of the company it represents but also on the hosts of other factors. If results are negative, it might trigger a fall.īut in the real world, factors affecting share price are far more complex. If the results are positive, the stock’s price will go up. What triggers buying or selling? Quarterly or annual reports published by the company. If there are more sellers, the price falls. If there are more buyers, the price goes up. In short term, a span of 2-3 months, stock price movement is mostly speculative. This is not only our problem, even experts of the stock market face a similar dilemma. □ Why do we think like this? Because we don’t know how to predict if a stock will go up or down. Ask common men, they will say that – stock’s price goes down more than it goes up.
0 Comments
Leave a Reply. |
AuthorWrite something about yourself. No need to be fancy, just an overview. ArchivesCategories |