NSE Scandal!! BSE like scam in the making??

[Punter786]

Is this the main reason most of us were losing??? Is this a big scam in the making ... https://pbs.twimg.com/media/CKfRVL1W8AASR1f.jpg

I got to know about this NSE related controversy on Twitter; on the timeline of editor of Moneylife magazine (the same lady journo who scooped the Harsha Mehta scam) .

Controversy is related to NSE co-location server etc. NSE has slapped defamation suit on the magazine. For more information you can go thru these Twitter links:

1) https://twitter.com/suchetadalal/with_replies (Read tweets and replies. They is some more info)

2) https://twitter.com/piyushchaudhry/status/624261526262673408

3) https://twitter.com/hashtag/NSEWar?src=hash

If this indeed turn out to be a some kind of scam (which I think it "might" given our broker disconnection etc issues lately and the constant hitting of stop losses just too accurately by counter parties) then regardless of what they do the market participants are never going to trust the fairness of market and the forces governing it in the future.

Such riggas!! Shame!! Shame!! Shame!! Old-timers would remember the BSE scam, but its reputation was never that great. But now even the NSE the epitome of integrity and fairness has done this!!!

Wonder to cry or get angry.

 

[mastermind007]

Is this the main reason most of us were losing??? Is this a big scam in the making ... https://pbs.twimg.com/media/CKfRVL1W8AASR1f.jpg

I got to know about this NSE related controversy on Twitter; on the timeline of editor of Moneylife magazine (the same lady journo who scooped the Harsha Mehta scam) .

Controversy is related to NSE co-location server etc. NSE has slapped defamation suit on the magazine. For more information you can go thru these Twitter links:

1) https://twitter.com/suchetadalal/with_replies (Read tweets and replies. They is some more info)

2) https://twitter.com/piyushchaudhry/status/624261526262673408

3) https://twitter.com/hashtag/NSEWar?src=hash

If this indeed turn out to be a some kind of scam (which I think it "might" given our broker disconnection etc issues lately and the constant hitting of stop losses just too accurately by counter parties) then regardless of what they do the market participants are never going to trust the fairness of market and the forces governing it in the future.

Such riggas!! Shame!! Shame!! Shame!! Old-timers would remember the BSE scam, but its reputation was never that great. But now even the NSE the epitome of integrity and fairness has done this!!!

Wonder to cry or get angry.

What exactly are the allegations and substance of the rigging?

 

[umeshmandal]

Colocation is an International phenomenon ! Its so common abroad ! Why is it a scandal!!?

Colocation has nothing to do with SL being hit accurately as feared! Fact is a SL remains undisclosed till the level is triggered so its all bull to say that SL are revealed to a selected few!

 

[DSM]

Mastermind,

Have read the entire report of the Singapore based quant employed by a hedge fund. What he alleges in the report, is that some NSE insiders allow a few fund houses quicker access intentionally to bid/offer data before others, which guarantees them close to hundred crores of RISK FREE profit each year. Basically, all co-located servers should get access at the same time, and there are technical means to do that. This levels the playing field for all players, but as per the report, this is not the case as access is intentionally tweaked in favour of a few.... which allows preferred fund's algos to execute both buy and sell on both sides and earn guaranteed profit on these trades. The report is insightful and well worth a read....

What exactly are the allegations and substance of the rigging?

 

[mastermind007]

Mastermind,

Have read the entire report of the Singapore based quant employed by a hedge fund. What he alleges in the report, is that some NSE insiders allow a few fund houses quicker access intentionally to bid/offer data before others, which guarantees them close to hundred crores of RISK FREE profit each year. Basically, all co-located servers should get access at the same time, and there are technical means to do that. This levels the playing field for all players, but as per the report, this is not the case as access is intentionally tweaked in favour of a few.... which allows preferred fund's algos to execute both buy and sell on both sides and earn guaranteed profit on these trades. The report is insightful and well worth a read....

Yes, where is that report?

In any case, this means that this prejudice affects those amongst few higher hedge fund folks. What has that got to do with retail trader's stop losses?

Having said that, Nevertheless, I have to admit is that every time market is to make a big violent move, I do face connectivity issues. I spent few grand on new wireless dongle, new router and the works but now this nonsense still happens. For high risk trade, I keep SL in the system otherwise I keep it written on paper next to my terminal.

 

[jagankris]

Yes, where is that report?

Nevertheless, I have to admit is that every time market is to make a big violent move, I do face connectivity issues. I spent few grand on new wireless dongle, new router and the works but now this nonsense still happens.

Dear MasterMind ji,

This happens only with a particular broker and repeatedly ?

Does this mean the broker disconnects the clients takes position against them and then restores the connectivity ?

But when asked tells the clients to check their internet connections ?
--- And clients think it is problem with their internet ?

May be one more terminal with another broker - has to be kept open parallel and see whats happening ?

 

[DSM]

Mastermind,

Re. Trader's SL - no there is nothing mentioned about that in the report. Somebody who has not read it in detail has misunderstood it. BUT what the report implies, is that if your SL is close, the algos with quicker access will will be able to sniff it out... And the other aspects of it, is what I agree - that a few preferred funds have got to milk approximately hundred crores of somebody else's money each year by availing of quicker access illegally.

Re. the report, I had read it about a month back, but now since the matter is subjudice and argued in the courts, I guess it would have been taken off the portal.

Re. disconnection, have to say, that I have not faced any such problem. I use Tata Broadband and it provides fairly reliable service in Mumbai.

Yes, where is that report?

In any case, this means that this prejudice affects those amongst few higher hedge fund folks. What has that got to do with retail trader's stop losses?

Having said that, Nevertheless, I have to admit is that every time market is to make a big violent move, I do face connectivity issues. I spent few grand on new wireless dongle, new router and the works but now this nonsense still happens. For high risk trade, I keep SL in the system otherwise I keep it written on paper next to my terminal.

 

[yusi]

Yes, where is that report?

nirav_j had posted the original link more than a month back.

 

[yusi]

I like the way Haim Bodek explain one kind of front-running at around 3 mins into this video at https://www.youtube.com/watch?v=-u5g0VPMH2s

Checking if the youtube plugin is available:

[YOUTUBE]u5g0VPMH2s[/YOUTUBE]

 

[TradeOptions]

nirav_j had posted the original link more than a month back.

The report is still available at the Original Article that made this whole episode open to the public -

http://www.moneylife.in/article/blowing-the-whistle-on-manipulation-in-nse/42337.html

You can download it as a pdf file and it is just 8 pages and very insightful, as dear DSM mentioned earlier. I would highly recommend that you read the report before making any opinion.

It is really shocking that NSE employees are involved in it like this and NSE is trying to suppress the report, rather then fixing up the mess.

And for those who thinks that it has got nothing to do with Retail Traders, I would say - Think Again ! When NSE employees are involved in this scam, then who knows, they might be involved in many other manipulations and wrong practices as well. If NSE itself favors some market players, through the corrupt employees, then that is bad for the whole market, including the retail traders.

Here are some more links related to the matter -

Market manipulated at NSE, scam runs into billions
http://indiasamvad.co.in/exclusive-...ional-stock-exchange-scam-runs-into-billions/

High-frequency Trading Needs a Detailed Probe
http://www.moneylife.in/article/high-frequency-trading-needs-a-detailed-probe/42620.html

Please note that this report is not saying anything that HFT is bad or any other stuff like that. It is clearly showing how NSE Employees are tweaking the internal systems / methods of NSE for favoring a few SPECIAL GUYS, who pays bribe to them. It is a Serious Crime.

NSE and SEBI both kept mum even after 5 months of that whistle blower letter. Kudos to Sucheta Dalal and the Whistle Blower to bring this to light.

Regards