What’s happening in the Tehran Stock Exchange?
According to Iran Gate’s report, the analysis of the buy and sell queues of stocks in the Tehran Stock Exchange indicates a busy buy queue for some stocks known as paper company stocks, mainly from the petrochemical group. However, the important question is why the buy queue for these paper company stocks, which are mostly from the petrochemical group, is busy. Another important question is which stocks are considered project stocks and how can they be distinguished from real company stocks.
The Tehran Stock Exchange is a market that has caused many shareholders and new shareholders to face heavy losses over the past 4 years. But the other side of this game also exists, and a few market participants have also seen the investment coin in the Tehran Stock Exchange. If we overlook the complexities of investing in this area, we are well aware that the Tehran Stock Exchange has deep legal loopholes and gaps, which have provided a basis for some individuals, whether natural or legal, to take advantage of.
Iran Gate has addressed one of the illegal methods of some major players in the Tehran Stock Exchange in this report. This method revolves around the axis of paper company stocks in the capital market and has put the interests of many unaware market participants at risk.
This method, known as stock project, is a type of speculation with the aim of earning massive profits by taking advantage of the ignorance of real shareholders or the misuse of informational rent. Now the question arises, which stocks are targeted this time to facilitate the entry of profit-seeking individuals into the Tehran Stock Exchange and cause heavy losses to ordinary people?
The papers that have been targeted for project
Examining the buying and selling queues of the Tehran Stock Exchange in recent days and weeks shows that 6 stocks from the group of stock exchange petrochemicals have been targeted. These stocks are mainly known as the shares of well-known paper companies and practically have no positive returns. These stocks do not justify the formation of a buying queue for them in any expert’s opinion. But which stocks are they and what is the document for their targeting?
Evaluating the situation of small and medium-sized stocks in the stock market indicates that stocks such as Jahrom, Darab, Fasa, Kazeroon, Memseni, and Dehdasht have been targeted. All 6 stocks mentioned are considered as worthless stocks among professional shareholders and stock market experts. The reason for this naming is the affiliation of these stocks to companies that are essentially paper-based and mostly have no foreign presence.
For example, companies like Petrochemical Dehdasht and the other 5 mentioned cases are only in the form of a collection that does not have real production and practically has no output or benefits that would generate returns and profitability. However, the number of paper shares of Petrochemical Dehdasht in the Tehran Stock Exchange is 7, and the list of the above 6 shares can be added with the symbol of Golestan. But currently, Golestan shares have been closed and trading has been halted, which is rooted in the lack of transparency in the trading process of this share.
How did petrochemicals become projects?
The process of turning shares into projects is one of the common violations of Iranian stock market whales. This method, which is considered a type of speculative trading, is actually the heavy profit-making from artificial and fabricated fluctuations by rent-seeking whales in the Tehran Stock Exchange. In fact, these fluctuations are carried out by creating demand shocks through the sudden and unexpected injection of high liquidity volume into the buy queue of small and sometimes medium shares.
This artificial shock will cause a sudden increase in the stock price and real shareholders in the market will perceive that something has happened to this stock that they are unaware of. Events such as an imminent capital increase, construction of a production line, or development of various sections of the company are examples of factors that can suddenly cause sharp positive fluctuations in company stocks.
However, because the mentioned increase in stock price is unsupported and due to cash injections, even the smallest cash outflow causes the stock price bubble to burst. Whales withdraw liquidity from this stock when they realize that the desired price has been achieved due to the entry of unsuspecting real investors.
Now it can be explicitly and confidently claimed that the 6 stocks mentioned have also been projectized with the same pattern. However, the project has not yet reached the final stage of withdrawing liquidity by rent-seeking whales, and for now, unaware real investors have created heavy buying queues everywhere. This means that as soon as rent-seeking whales feel that any of these 6 stocks have reached the desired price, they immediately sell their shares and make several hundred percent profits.
After this action, suddenly the stock price takes a downward trend due to the sudden increase in supply and the disclosure of the project, causing the stock price to drop below its initial range because it loses the credibility it had.
Shareholders should be cautious.
According to the provided explanations, shareholders who are hesitant to buy these 6 stocks should better proceed with more contemplation and research. However, Iran Gate cannot act as an investment advisor in the stock market, but this report is merely a revealing narrative of the integrated and coordinated project of these 6 petrochemical paper stocks in the Tehran Stock Exchange.
This project can be much riskier than ordinary project developments because in most cases, small stocks that become projects have minimal factors for their stock growth. However, in this case, none of these 6 stocks not only have the desired minimum factors but also do not have any real production capacity behind their prestigious names.
This means that after the project fails and the price bubble bursts, it is possible for the stocks to move towards complete failure and long-term closure. In other words, if this scenario happens, people’s investments in this stock will essentially be lost, and considering the current inflation rate of over 50%, it can be said that deceived real assets will practically be destroyed.
For this reason, it is said that shareholders should make maximum efforts to investigate investment factors for these 6 stocks before queuing up to buy them, in order to avoid heavy losses.
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