{"id":10856,"date":"2022-12-14T10:48:03","date_gmt":"2022-12-14T05:18:03","guid":{"rendered":"https:\/\/polscienceweb.com\/?post_type=portfolio&#038;p=10856"},"modified":"2022-12-14T11:58:35","modified_gmt":"2022-12-14T06:28:35","slug":"what-is-circular-trading-and-how-is-it-performed","status":"publish","type":"portfolio","link":"https:\/\/polscienceweb.com\/index.php\/portfolio\/what-is-circular-trading-and-how-is-it-performed\/","title":{"rendered":"What is circular trading and how is it performed?"},"content":{"rendered":"\n<h4 class=\"has-text-align-center wp-block-heading\"><strong>Circular Trading Manipulates\u00a0the Market<\/strong><\/h4>\n\n\n<div class=\"has-text-align-center wp-block-post-date\"><time datetime=\"2022-12-14T10:48:03+05:30\">14th December 2022<\/time><\/div>\n\n\n<div style=\"height:16px\" aria-hidden=\"true\" class=\"wp-block-spacer\"><\/div>\n\n\n\n<details class=\"wp-block-verse\" style=\"font-size: 18.5px; text-align: justify;\">\n<summary class=\"wo-block-verse\" style=\"font-size: 18.5px; text-align: center;\">Read more<br><br><\/summary>\n\n\n\n<p class=\"wp-block-verse\" style=\"font-size: 18.5px; text-align: justify;\">Circular trading can be done in different forms:<\/p>\n\n\n\n<p class=\"wp-block-verse\" style=\"font-size: 18.5px; text-align: justify;\"><strong>Form 1:<\/strong> It refers to the transaction of buying and selling goods (without the<strong>&nbsp;actual movement of goods)<\/strong>&nbsp;through shell companies. In circular trading, a circle is made by a group of companies that engage themselves in fake sales transactions by producing fake sales invoices. <strong>The main aim<\/strong> is to inflate the turnover of the business. However, through circular trading, companies may also aspire to:<\/p>\n\n\n\n<div style=\"height:13px\" aria-hidden=\"true\" class=\"wp-block-spacer\"><\/div>\n\n\n\n<ul class=\"wp-block-verse\" style=\"font-size: 18.5px; text-align: justify;\">\n<li>increase the value of their company or business<\/li>\n\n\n\n<li>get bigger loans from banks;<\/li>\n\n\n\n<li>bring illegal money into the system;<\/li>\n\n\n\n<li>get fake input tax credit.<\/li>\n<\/ul>\n\n\n\n<div style=\"height:13px\" aria-hidden=\"true\" class=\"wp-block-spacer\"><\/div>\n\n\n\n<p class=\"wp-block-verse\" style=\"font-size: 18.5px; text-align: justify;\"><strong>Form 2: A &#8220;circular trade&#8221; occurs when a group of people works together to buy and sell shares frequently in order to influence the stock price. <\/strong>The buy orders for the same number of shares at the same price cancel out the sell orders.<\/p>\n\n\n\n<p class=\"wp-block-verse\" style=\"font-size: 18.5px; text-align: justify;\">In other words, a circular trading strategy involves numerous participants to create the illusion of new owners acquiring shares, but, in reality, the same shares are merely transferred along with no actual change in value.<\/p>\n\n\n\n<p class=\"wp-block-verse\" style=\"font-size: 18.5px; text-align: justify;\">A trading strategy of this type does not indicate a genuine change in beneficial ownership of the share. It artificially inflates volumes to demonstrate that security has liquidity, to keep the share price at the desired level, and to demonstrate a market interest in the stock.<\/p>\n\n\n\n<p class=\"wp-block-verse\" style=\"font-size: 18.5px; text-align: justify;\">Because the stock market is speculative, the greater trading volume provides the perception of increased market demand. Day traders may fall victim to such a scam if they are looking for new investment opportunities, notice high volume on a stock, and buy in with the expectation that the shares will rise in value. In many nations, the practice is prohibited or illegal.<\/p>\n\n\n\n<div style=\"height:14px\" aria-hidden=\"true\" class=\"wp-block-spacer\"><\/div>\n\n\n<div class=\"wp-block-image\">\n<figure class=\"aligncenter size-full\"><img fetchpriority=\"high\" decoding=\"async\" width=\"800\" height=\"400\" src=\"https:\/\/polscienceweb.com\/wp-content\/uploads\/2022\/12\/2.png\" alt=\"circular trading\" class=\"wp-image-10855\" srcset=\"https:\/\/polscienceweb.com\/wp-content\/uploads\/2022\/12\/2.png 800w, https:\/\/polscienceweb.com\/wp-content\/uploads\/2022\/12\/2-300x150.png 300w, https:\/\/polscienceweb.com\/wp-content\/uploads\/2022\/12\/2-768x384.png 768w, https:\/\/polscienceweb.com\/wp-content\/uploads\/2022\/12\/2-585x293.png 585w\" sizes=\"(max-width: 800px) 100vw, 800px\" \/><\/figure>\n<\/div>\n\n\n<\/details>\n\n\n\n<div style=\"height:16px\" aria-hidden=\"true\" class=\"wp-block-spacer\"><\/div>\n\n\n\n<p class=\"has-text-align-center\">Source: <a href=\"https:\/\/www.financialexpress.com\/economy\/gst-council-to-discuss-circular-trading-de-criminalisation\/2904937\/\" target=\"_blank\" rel=\"noreferrer noopener\">Financial Express<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"<p>Circular Trading Manipulates\u00a0the Market Circular trading can be done in different forms: Form 1: It&hellip;<\/p>\n","protected":false},"author":1,"featured_media":10854,"comment_status":"closed","ping_status":"closed","template":"","portfolio-category":[428,451,426],"class_list":["post-10856","portfolio","type-portfolio","status-publish","has-post-thumbnail","hentry","portfolio-category-428","portfolio-category-december-2022","portfolio-category-newsfeed"],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v27.3 - https:\/\/yoast.com\/product\/yoast-seo-wordpress\/ -->\n<title>What is circular trading and how is it performed?<\/title>\n<meta name=\"description\" content=\"In other words, a circular trading strategy 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