What’s going on in Borsa Istanbul?

Iris Grasshopper

Raccoons wash their food first and then eat it. I recently watched a video; While trying to wash it in the river with cotton candy, the cotton candy disappears in your hands.

That’s exactly why Borsa İstanbul came to my mind.

After the Bist 100 index increased by 43 percent and the banking index by 164 percent in 2 months, the Bist 100 index fell by 16 percent and the banking index by 38 percent in 5 days. As can be seen from the figures, this was actually a bank operation.

So what happened, let’s go back to the past first.

The two groups, which had previously made big money in two shares, decided together, the banks were cheap, they were ready for operation. Purchasing started, small goods were collected, and then the operation began.

On the share futures side, purchases accelerated, and as purchases accelerated, the interest on the share contract began to rise. They were traded at an annual interest rate of up to hundreds of percent. Seeing this, investors and arbitrage funds started to open short selling transactions in stock futures. This was the main food source of the system. Arbitrage funds buy on spot in order to benefit from high interest rates; while they were earning returns, they were also supporting the spot. On the other hand, share contract short sellers were drowning one by one. Every day margin calls were occurring at high levels.

Not having enough money in the margin call, they had to close their short position in the futures market by buying, helping to push the shares higher.

Meanwhile, we were already starting to riot… He calls the CMB to duty, asks them to examine the transactions, questions why the gross swap is applied only to 2 small bank shares, and most importantly, he never opens a trade without putting a stop to the investor. We were recommending.

Then the thing we feared but expected came true.

First came the news of Akbank’s sale of 8 million lots of Akbank pension fund, the sale of 150 million TL swelled excessively, frightening the investors who were already ready for panic in the shares, causing them to go on sale as well.

They say there are two favorite sins of the devil, the first is arrogance and the other is greed.

Here, our group of 3-5 people, who were greedy and thought that they would take the boards to the ceiling forever, panicked in the face of this unexpected sale. They slept under the board, as the traders put it. They started to welcome the sale as it came. Some boards became floors, they tried to remove the floors, but it was not possible. The next day, the same scenario continued, but they could not succeed, the sellers panicked and poured all their shares into the heads of our friends. For exactly 5 days, the boards went on the contrary, this time the sole. They had sunk all the short sellers while the market was going up, now it was their turn, the gun they were using was shooting themselves.

Last Thursday, they themselves had a record level of margin calls and were experiencing equity problems. The brokerage houses said either bring your money or buy the goods, but they couldn’t sell the goods. They tried to salvage the situation with some cash and some sales on Friday. On Saturday evening, they had a meeting, they were going to find money and remove a few banks again on Monday to hunt for investors and sell goods.

But these plans also exploded in their hands, yesterday, İşbank and Denizbank announced that they suspended the Russian payment system MIR, due to US pressure, on the index and banks that were already shaky during the day. This again caused panic and Borsa İstanbul was shut down.

Now there was systematic risk. Therefore, a meeting was held with intermediary institutions and senior officials, first with the TSPB (Association of Intermediary Institutions) and then with the Capital Markets Board. A number of decisions were made to eliminate these risks, but these decisions were made to save the day, not to improve the functioning of the market in the long run.

Borsa İstanbul is one of the most distinguished institutions of our country… You have jointly injured this distinguished system in which the capital is financed and the investor is a partner to the companies through the method of providing funds.

Not just a manipulator; Institutions that open their limits knowing the risk.

CMB, which brought 2 ceilings of gross swaps to other boards, waiting for an extraordinary price movement announcement to KAP, but could not see this movement.

While it is obvious that this is an operation, the Ministers who gave investment advice saying that it was an indicator of the shine in our economy, and the market professionals and financially literate investors who wrote and drew this move by claiming that this move was a rally, who considered this move as normal because it made money, and said it was cheap anyway; all responsible…

You are all responsible!

Good luck to all of you for the capital markets operation that will be remembered for years with this operation, which will frighten small investors, and which you have spread to the ceiling when you say let’s spread to the bottom.

You washed the cotton candy in water, tell me what you have left now…

As market professionals, our expectations are:

  • Appointment of experienced people who have been in the capital market institutions to Borsa Istanbul and supervisory institutions
  • Establishing systems to ensure that unusual movements are immediately noticed
  • Timely and equal application of necessary measures and penalties to everyone and every case
  • Manipulation is a serious crime, punishments suitable for this crime are already in place by regulation, their enforcement, Seeing that the penalties for manipulators who make billions are no longer a deterrent
  • The application of the gross clearing application to the account holder, not to the stocks, and this measure taken for the wholesale shares makes the small investor aggrieved.
  • Ensuring that the intraday transactions of buyers and sellers in the futures markets are absolutely visible. As we have seen in the events today, great grievances have been experienced since the investor did not see the intraday brokerage distribution of viop.
  • Auditing algorithms

If these recommendations and more are implemented, it will be possible for the markets to function effectively and to provide a more reliable environment.

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