The big players.

In the stock market, there are small and big players. Small players are retail investors while big players may be instituitional investors or other high net worth investors. When a stock is chosen by big players to be invested in, the stock may follow certain behavioural dynamics in it's price. If small players like the common retail investors can pick up some simple behavioural dynamics of the big players in a certain stock, they can ride on the strength of the big players and derive profits by understanding the mechanics of how big players invest in certain stocks.

Usually big players invest in a sequence as follows:
1. Selection of a potential stock to invest in.
2. Period of accumulation.
3. Period of flushing out weak players.
4. Period of pushing up a stock price.
5. Period of unloading the stock at a suitable higher price.

Selection of a potential stock to invest in

Big players like to select stocks that can rise in stock price. What are stocks that can rise in stock price? Most often, these are stocks with a current or near future popular theme. Some ages back, we have stocks like the internet stocks which were chased like crazy having their stock prices pushed to sky high. It is not always the case that a stock must have a popular theme to be selected, just that it is very common to "fish at a river that have many fishes" (where there is a popular theme for the stock). Another consideration is that the stock price must be suitable to invest in so that there is some room for appreciation in the stock price (usually this may involve investing onto a bull run when the general market sentiment is bullish).

Period of accumulation

After a stock is selected, there is a period of accumulation by the big player. The period of accumulation can be long as the big player patiently buy up slowly and accumulate a large number of shares over a period of time. By accumulating slowly, the stock price is prevented from being pushed up too fast.

Period of flushing out weak players

Sometimes, if the big player cannot accumulate a substantial amount of shares at low prices, it can push up the stock price a little bit (e.g. by 10% price appreciation) and buy in from short-term investors who are willing to let go their shares after getting a 10% profit. During this period of flushing out weak players, big player can also create a resistance point whereby it suppresses the stock price from going higher by some amount of selling. Weak players once seeing the stock price appreciate a little followed by a little bit of falling in prices, quickly sell their shares to lock in some amount of profits and avoid loss. In doing so, the big player continues to accumulate some more shares to build up their position. The objective of the big player is to accumulate a major portion of the shares so that when the price appreciates later, it being the biggest player will have the most reward from the gain in stock price.

Period of pushing up the stock price

Once the big player is satisfied that it holds a large enough portion of the stock, it goes through a period of pushing up the stock price. This move will see the stock appreciate by a large magnitude. Some smaller players who have not leave the scene yet will get their rewards from riding on the wave of the stock price movement.

Period of unloading the stock at a suitable higher stock price

Once the big player has managed to push up the stock price, it has to unload it's shares to finish this whole cycle of investment. So, there is a period of unloading whereby the big player slowly sell off it's shares to other unwary investors. Usually unwary retail investors after seeing the stock price has appreciated by a large magnitude, may become filled with greed and buy from the big players hoping that the stock price can continue to appreciate further. Little do they know that the game has just ended, so these unwary retail investors become the final people to carry the shares at a "high price", shares that will not appreciate further but almost often depreciate after the big player has left the scene.

Conclusion

By understanding the mechanics of how big players work, a retail investor can be better informed and be wary of certain behavioural dynamics in the stock price movement over a period of time. The big players are a force not to be trifled with as these are players with extremely large capital to inject into a stock. So, it pays to understand how they work so as to ride on their success and get a pie of their gains.