High-frequency trading was active in Tourism Finance Corporation, Tarmat Limited, and Urja Global on February 22. Tourism Finance Corporation and Tarmat Limited closed higher.
High-frequency trading firms (HTFs) – or algo firms on steroids –use complex algorithms and powerful computers to execute trades at lightning speeds. These firms typically try to capture the spread between the spot and futures prices, but recently they have been active in small, illiquid stocks as well.
The volumes generated by them, more often than not, attracts retail investors to these stocks.
Stocks where HFTs were active on February 22:
Tourism Finance Corporation
Active names and traded stake: Mansi Share and Stock Advisors (1.18 percent), Multiplier Share and Stock Advisors (0.76 percent), Setu Securities (0.66 percent), Jainam Broking (0.68 percent).
Stock movement and volumes: Gained 5 percent to Rs 242.75. Trading volumes at 2 crore shares versus 1-month average of 66 lakh shares
Technicals: Stock is above 50-DMA and 200-DMA
Fundamental trigger, if any: Aditya Kumar Halwasiya picked up a 13 percent stake in the company on February 21.
Tarmat Limited
Active names and traded stake: NK Securities (0.54 percent), Ramesh Dobariya (0.54 percent), Vimal Khunt (0.52 percent)
Stock movement and volumes: Gained 19.99 percent to Rs 109.95. Trading volumes at 54 lakh shares versus 1-month average of 6 lakh shares
Technicals: Stock is above 50-DMA and 200-DMA
Fundamental trigger, if any: No
Urja Global
Active names and traded stake: Multiplier Share and Stock Advisors (0.72 percent)
Stock movement and volumes: Lost 4.09 percent to Rs 23.3. Trading volumes at 1 crore shares versus 1-week average of 3 crore shares
Technicals: Stock is above 50-DMA and 200-DMAFundamental trigger, if any: No
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