@Onlinegtrash
An explanation in a nutshell you can addapt to your market:
Goldman Sachs and other player sometimes come in with an order of 2000 or more atm or otm options in the S&P 500. If we are able to see that order size and to see if this are put or calls, we know that Goldman Sachs know something and we can anticipate a move in the S&P 500 according to the information given thru the put or call. (I will come to the stragies played at the end of this post)
If this happen on a specific share with not to big volume, it is very clear that the share is going to move very soon in the direction of the bought or sold option. Broker houses have the tools to watch the big guys 24 hours a day and according true that information they have an advantage and can play the game a bit in another way. Every big broker in the States has such screening software for the biggies, so your big brokers and banks should be in the same situation.
The S&P500 is huge, so not even GS or other big players can manipulate much. Another case are the stocks. Here GS and other big players clearly can manipulate the direction of the price just by the volumes (USD) they are able to spend for such orders. (But is the word manipulation absolut the right word or maybe not?)
Another example are certain future markets. Even smaller traders can become market makers through the size they hold in lots and the price of bid or ask which they are willing to offer to the other participants. Stuff like mention from Mr.G is out of question, as market participants are not stupid. This game has nothing to do with inverstors nor is it a game for children and would like to be like we have some here in the forum; instead a game for very hard calculating, very fact and money oriented people and traders with no mercy for their counterparts. The idea in such, many times very clever in advance prepared games, is in many cases the money now and today. There are sometimes other reasons behind it, but the money must follow relativ quickly in such events. So, traders and speculators do fame and are in charge of those short time events and not investors. Guess non of the onces which really bring in qualitative informatin with any value in this thread are deeply related to investors play in any kind. Would like to be FA inverstors should not even try this game and better stay in their places, as traders do not give any advises to their ways of investing. Two complete different worlds. There is meat and there are bones. Those who do that business and make constant money with it are in most cases the bones and those who loose in such moments are in most cases meat. Sounds hard, but be true about your selfs. How many times did you lose money on such market behavior, how many times did you make money with such market behavior and how many times have you been in a place to be the reason for such a market event?
I am not sure if in Nifty someone is able to manipulate the whole market. That is why I wrote Millions are not the case. But as you now say that it would be possible, so then it would also be easy for the big guys and brokers, who watch each other, to know who this would be. If one of the big players would know that from the other big player and the whole game would be to his disadvantage because of that manipulation from that specific company, he would act for example by looking for other big partners to get revenche on that specific company. Happens in the past when G. Soros was put out of a huge game in a speculation against the currencies of a certain country. The big boys stood together against him and in that specific case he lost huge sums of money.
In the share market any big player can for example hold a huge bunch of shares from a specific company. If they now decide to sell that huge amount of shares to their customers or to the public for whatever reason, they will surely buy puts to make further profit on that share, as when selling huge amount of shares in a short time, the price of the share will fall. Not in all cases, but read on. Is it manipulation? As mentioned in one of the post: Difficult to find out. It is my right to hedge my position for whatever reason. The one who offers in this example the shares to the public did not force others to buy them. So instead of manipulation we also could say: Tactical game.
So the strategies used from all the big players include small market makers are very simple at the moment they know what their orders can have for an impact in specific markets with specific derivatives. Big guys and others who ever have been market makers in any kind of such market know that impact very precesely, otherwise you do not get in that position and stay there. So the hedges are from simple like synthetic put and calls to more complicate with three legs like calendar collars or the use of LEAP options. I could add some more strategies here, but in general the rules also here: Simple and quick, so the money is nailed and the risk is gone.
Now if this gives any answer to your thread title, you have to decide by your self. But at least you got some more information and thoughts which surely are worth to discuss further in your thread if needed.
Take care / DanPickUp
...............to accumulate or distribute the stocks
