What is Grey Market Premium?
Grey Market is the best platform to deal in IPOs but it is not official. Grey market premium OR called IPO GMP is showing estimated rates of upcoming ipos before opening or listing price or company decided price-band. These prices are keeps changing until the IPO listing price is opened, so India peope are more seaching what is GMP today in in Indian stock market including some famous status & cities.
This all things are controlled by SEBI because of popular despite being illegal where the price of the public issue is listed and traded between different investors.
Now let’s know what is Grey Market Premium on GMP today here? The price at which the trade is traded is called premium, indicating the approximate listing price.
Latest Grey Market Premium Today & Kostak Rates
(As On 16-08-2018)
|IPO Names||Price-Band||GMP Today||Kostak||Subject to Sauda|
|CreditAccess Grameen||418 – 422||3-5||200||–|
IPO Grey Market Premium – Key Factors
If you are thinking of trading or investing in the IPO Grey Market then you should know some of the following facts about the IPO Grey Market Premium.
- Premium in Grey Market is only available in Mainline IPOs (but selected are in SME IPOs)
- IPO grey market premium is updated here for specific date.
- We are not showing brokerage price as showing only a estimated GMP on upcoming IPOs in India
- IPO GMP in grey market has not been regulated by any Indian stock market because it is illegal
- We are not suggesting here to buy and sell IPO forms on IPO Grey Market.
- Kostak rate is one kind of premium which is showing average price on IPO companies.
- These all are just suggested/estimated GMP & kostak rare, it will be changed daily as market condition.
Grey Market does not have official exchange like BSE or NSE. There is a trading on the phone with mutual trust. For this, it is necessary for the operator to have a personal contact. The deal in the grey market is not guaranteed to be completed. Deals are reserved for the day of listing on NSE or BSE. Grey premium, the difference between the trading price, is in the settlement cache. There are also small retail applications in this deal.
The reasons why the grey market is so popular are the reasons for this indicating the response of any IPO. The listing of the company gets the idea. Many big investors put money in the grey market instead of the IPO. This listing is an attempt to take advantage of this.
Let the investors know that the grey market is unofficial, there is a risk of not being able to complete the deal, as well as not being completely confident on the grey premium. Keep in mind that see the company’s fundamentals and valuation. Make money in IPOs only on the basis of fundamentals and valuations.
Whats is Kostak Price/Rate in Grey Market
Kostak price or rates is a concept that is basically the monetary value of the IPO application. It is one type of traded in grey market at a specific price based on market condition. It is pre-decided to tie-up with other person on fix value.
The normal process for the stocks to be deposited in your demat account and the transactions that occur through your trading account remain the same.
After saying this, with the overabundance of various IPOs (good or bad) these days, the concept of kostak rate is a back door to enter a public issue. The main reason for this is that investors know that the possibility of actually allocating is limited, especially if the IPO is very good and can bring profits faster.
What Is Subject to Sauda?
This is a another concept of the shares of IPO allocation , it works only on when ipo allotment is done in the demat account. Actually, in this case, grey market price is much higher than the offered actual price , while the remaining procedures and details are the same.
A key aspect that you should understand is that if you take the allocated shares under the kostak price or ‘Subject to Sauda’, then the sale of these shares is going through your trading account. And for that reason, you have to pay short-term capital tax. In this way, make all the costs together by doing your math.
It is also important to know that without involving STCT, you will actually get less profit or there will be no benefit in all these trades.