User:Hbat4478/Circular trading

Circular Trading

Overview:

This section will provide a general overview of circular trading. It will provide a detailed definition and briefly explain the importance of this practice in the way it has been used to defraud stock exchanges.

Market Consequences:

This section will go into detail about the methodology behind circular trading, and this will be used to describe how it essentially cheats the system by artificially inflating stock prices. The proven consequences of this on the stock market will be outlined.

Examples:

Circular trading is a global issue, however most of the high-profile cases come from India. This section will look at a couple of the most significant circular trading examples and provide an overview of how they occurred and the consequences.

Responses:

This section provides an overview of the ways in which governments and other organisations are attempting to target circular trading. It will focus on the government’s role in terms of legislation that has been introduced, as well as some of the statistical research that has been conducted which is currently working towards better detection of this fraudulent practice.

Sources:

Investopedia. (2018). Circular Trading. Available: https://www.investopedia.com/terms/c/circulartrading.asp. Last accessed 10th Sep 2018.

Economic Times. (2010). SEBI bars 16 people from market for circular trading. Available: https://economictimes.indiatimes.com/sebi-bars-16-people-from-market-for-circular-trading/articleshow/5603771.cms. Last accessed 10th Sep 2018.

Sharma, R. (2014). Circular Trading in Stock Market. Available: http://www.blog.sanasecurities.com/circular-trading-stock-market/. Last accessed 10th Sep 2018.

Salahshoor, R. (2018). A Novel Approach for Circular Trade Detection in Mercantile Exchange. Available: https://geistscience.com/JFER/Issue1-18/Article3/JFER1803103.pdf. Last accessed 10th Sep 2018.

Pannu, S. (2012). Stockbroker Ketan Parekh in major stock market scam, reveals IB report. Available: https://www.indiatoday.in/business/market/story/stockbroker-ketan-parekh-major-stock-market-scam-ib-report-108321-2012-07-07. Last accessed 10th Sep 2018.

Annotations for sources:

1.     This will be utilised in the Overview and Market Consequences sections, as it provides a strong overview of what circular trading is and how it artificially inflates stock prices.

2.     This will be in the Examples section, as it is a newspaper article outlining one of the most high-profile cases of circular trading, including the response and consequences of this legal decision.

3.     This will also be used in the Overview, as it provides some further information about how circular trading works. This will also be used in the Responses section because it outlines the price filter legislation that has been implemented in an attempt to combat circular trading.

4.     This is one of the most significant statistical studies that has been done on circular trading. It also provides information about potential ways to combat this fraudulent practise based on the findings, making it a useful addition to the Responses section, as it indicates the current level of knowledge and expertise that can be harnessed against circular trading.

5.     This is the other high-profile case of circular trading that has occurred in India, which is one of the main reasons this is a notable topic, because of the large market consequences of artificially inflating the value of the stock of many popular companies on the stock exchange. As such, it will be used in the Examples section.

wikiproject:

finance and investment

WikiProject Finance & Investment