Will government funds be saved? / Dominance of oscillators on refining and Dara 1
According to Tejarat News, it was in March of last year that Majid Eshghi, the head of the Securities and Exchange Organization, announced the amendment of the constitution of these two funds, pointing out that the two funds Dara Ikem and Palish Ikem have become a problem in the capital market.
According to Eshghi’s statement, if this structure is modified, the price of these two funds could approach their net asset value. This action required the approval of the government board, but investigations show that no action has been taken so far.
Meanwhile, on July 22, Ali Bahadri Jahormi, the government spokesman, announced that the restoration of the intrinsic value of the Ikem and Dara Ikem refining funds is under the order of the Securities and Exchange Organization. The statutes of these two funds will be amended soon in order to compensate the loss of the shareholders, but so far no change has been observed in the trend of these funds and both of these ETF funds are in losses.
Ali Asghar Heydari, a capital market expert, said in a conversation with TejaratNews: Examining the trend of the difference between the NAV and the price of the two Dara and Refinement funds since the beginning of their entry into the stock market until now may be able to help to diagnose this huge difference. But what is clear to a large extent is that due to the small trading fees of ETF funds and on the other hand the very high number of unit holders of these two funds, Dara and Refinement units have become very attractive options for volatility.
The attractiveness of government funds in the stock market
He continued: so that the volume and value of these two funds’ transactions are very high compared to the rest of the market, it is completely indicative of the volatility activity by professional oscillators and those who have the possibility of high-frequency and algorithmic trading on these funds. So that with rapid fluctuation and limited fluctuation range, while earning profit for himself, he has taken the possibility of proportional growth from these symbols.
Heydari explained: This is despite the fact that real retail shareholders are generally not willing to sell at the current prices due to the losses caused by holding these two symbols. But as soon as there is a relative increase in price (even 10%), many of these patient and losing shareholders become sellers of these symbols.
This capital market activist stated: So as long as this attractive position exists on the symbol of these two funds. Even if the symbols of banking or refining companies grow, there is no possibility of growth in these funds.
Heydari finally said: definitely and certainly; To eliminate these conditions, the first action must be taken very urgently. Algorithmic trading is prohibited for at least two months on the Dara and Refinement symbol.