{"id":126543,"date":"2024-09-03T01:25:12","date_gmt":"2024-09-03T01:25:12","guid":{"rendered":"https:\/\/news.talkwithrattan.com\/index.php\/2024\/09\/03\/individual-investors-sell-half-of-ipo-shares-in-a-week-sebi-times-of-india\/"},"modified":"2024-09-03T01:25:13","modified_gmt":"2024-09-03T01:25:13","slug":"individual-investors-sell-half-of-ipo-shares-in-a-week-sebi-times-of-india","status":"publish","type":"post","link":"https:\/\/news.talkwithrattan.com\/index.php\/2024\/09\/03\/individual-investors-sell-half-of-ipo-shares-in-a-week-sebi-times-of-india\/","title":{"rendered":"Individual investors sell half of IPO shares in a week: Sebi – Times of India"},"content":{"rendered":"
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MUMBAI: The casino culture seen in the stock market‘s derivatives segment may be rubbing off on IPO investors too. A Sebi study has pointed to the “flipping behaviour” of individual investors and banks chasing short-term gains from IPOs.
Consider this: Individual investors sold 50% of the shares allotted to them by value within a week of listing, and 70% of shares within a year.When IPO returns exceeded 20%, individual investors sold nearly 68% of the shares within a week. In contrast, only about 23% of shares were sold when returns were negative, according to the study which tracked 144 mainboard IPOs that were launched between April 2021 and Dec 2023.
The study by Sebi researchers found a strong disposition effect, with investors showing a greater propensity to sell IPO shares that posted positive listing gains, compared to those that listed at a loss.<\/p>\n
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A similar behavioural study by Sebi had shown that nearly 90% of investors in equity derivatives market segment lost money. It had also showed that the top 1% of the active traders who made profit were able to corner 51% of the market’s total profit.
The study showed that non-institutional investors (NIIs), popularly called the high networth individuals or HNIs, were more aggressive in booking profit in the short term than the absolute retail investors. NIIs sold about 63% shares by value while retail investors sold nearly 43% shares by value, within a week of listing.
The same study also showed that banks were the most aggressive sellers of IPO shares, while mutual funds, true to their mandates, barely sold for short-term gains. Within the first week itself, banks disposed of nearly 80% of their shares by value. In comparison, mutual funds sold just 3.3% of the shares they were allotted during the IPOs. A little over 39% of the retail investors were from Gujarat, followed by Maharashtra (13.5%), and Rajasthan (10.5%), the study noted. Also, one out of two IPO applicants held a demat account opened amid Covid, that is between 2021 and 2023.<\/div>\n