Out of the box What cause the collapse of the stock market?
What cause the stock market to collapse on 9 March 2020?

a) The spread of corona virus in Europe and America?
b)  The collapse of the oil talk between Saudi Arabia and Russia?
c) TKL's birthday?

I believe that the biggest factor is - hedge funds.

When the hedge fund sold the shares in large quantity, the rest of the traders falling. This led to a large decline. The momentum of the fall will continue for a few days or weeks. 

When will the stock market turn around? It will be caused by the hedge funds. If they change their strategy and start to buy in large amounts, the market will turn around. This might be triggered by some positive news, e.g. agreement between Saudi Arabia and Russia, or the discovery of a vaccine against the corona virus. This will be helpful. 

Sometimes, the sentiment will change just because of the large scale buying by the hedge funds. 

Some people describe their activities as "manipulation of the stock market".

Tan Kin Lian


 

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