5 Stock Market Sharks: How They Move Share Prices

Banks, Hedge Funds, CTAs, HFTs & Trading Houses

Before you dive into the world of trading and experience the "highs and lows" of being a day trader, it is important to understand who the major institutions — or sharks — are that shape the stock, currency, and commodity markets worldwide.

Besides acting as brokers or market makers, all these institutions also trade for their own accounts — and nearly all of them use algorithmic trading (algo trading) systems or mechanical programmes.

INVESTMENT BANKS

In the stock, bond, mutual fund, futures, and forex markets, investment banks are the most powerful sharks — names like Goldman Sachs, Morgan Stanley, UBS, and J.P. Morgan are constantly featured in financial headlines and portals. In Malaysia, examples include RHB Investment Bank, Kenanga Investment Bank, CIMB Investment Bank, and others.

When a company wants to raise capital for the first time (IPO), it is the investment banks that prepare the documentation, provide advisory, set the share price, and help sell shares to institutional investors.

They also use their vast network of elite clients to sell large blocks of shares before the stock is publicly traded. Only after the IPO is listed can retail investors buy shares on the open market.

HEDGE FUNDS

This group consists of private investment firms that invest using their owners'' and clients'' money — usually with high leverage. Hedge funds employ various investment strategies:

Global Macro Fund: Invests across any market without restrictions to find profit opportunities.
Managed Futures / Long-Short Fund: Profits whether prices go up or down.
Special Situations Fund: Focuses on distressed companies such as bankruptcies or leveraged buyouts (LBOs).

Under the hedge fund category, there are also two important branches: CTAs and HFTs.

COMMODITY TRADING ADVISORS (CTAs)

CTAs are fund managers who use algo trading systems based on technical analysis. The basic principle is simple:

"If this happens, take this action."

For example, a CTA programme may be set to react to the US monthly jobs report. If the employment data is strong and the market responds positively, the algo buys; if weak, it sells.

Because their trade sizes are large, CTA actions can shake the market and create opportunities for day traders.

HIGH FREQUENCY TRADERS (HFTs)

HFTs also use algos, but they trade at extraordinary speeds. They rent servers close to stock exchanges to gain the fastest access to order flow data.

This allows them to "see" the market direction a few milliseconds ahead of everyone else. When buyers dominate, HFTs buy aggressively. When sellers take over, they sell rapidly.

HEDGE FUNDS ARE NO LONGER INVINCIBLE

Before the 2007–2008 subprime crisis, hedge funds were considered "invincible" stock market sharks. Access to information and massive capital gave them an extraordinary edge.

But now, with social media and digital footprints on price charts, retail investors can track their movements much more easily. Although still influential, their impact on the market is now far smaller than before.

HEDGE FUND PERFORMANCE AND STRATEGY

Market sharks such as major wealth management firms UBS and Morgan Stanley typically advise investors to allocate 15–20% of their portfolio to alternative investments — including hedge funds, private equity, and derivatives.

Traditionally, hedge funds performed well during volatile global markets. However, they are now more profitable when markets are in a sustained trend — whether up or down.

Sometimes, their hedging strategies can backfire — for example, when too many investors buy put options simultaneously, it often signals that the market is nearing a market bottom.

Key lesson: In a strong uptrend, simple strategies often outperform complex ones. "Buy low, sell high" — remains relevant from the past to today.

Five World-Renowned Hedge Fund Examples

1. Bridgewater Associates

Founded by: Ray Dalio
One of the largest hedge funds in the world with assets exceeding USD 100 billion.
Strategy: Global Macro — investing based on global economic trends and national monetary policies.

Known for its deep analytical approach and the principle of "radical transparency" in management.

2. Renaissance Technologies

Flagship fund: Medallion Fund, famous for extraordinary annual returns (estimated >30% per year after fees).

Founded by: Jim Simons, former mathematician & MIT professor.
Strategy: Quantitative / Algo Trading — all investment decisions are made by mathematical models and computer algorithms.

Notable hedge funds and alternative funds in Malaysia & Asia — including those based in Singapore and Hong Kong (two main fund management hubs in the region):

3. Eastspring Investments Berhad (Malaysia)

Although not a "pure hedge fund", Eastspring manages institutional funds with an active approach similar to hedge funds (long/short, hedging, and derivatives).
A subsidiary of Prudential plc (UK).
One of the largest fund managers in Malaysia.
Focuses on equity funds, fixed income, and multi-asset strategies.

4. Quantedge Capital (Singapore)

This is a market shark from Asia and one of the most successful hedge funds in Southeast Asia.

Established in 2006. A hedge fund based on quantitative & statistical arbitrage.
Manages billions of dollars in assets with a fully automated strategy.

5. Affin Hwang Asset Management & Kenanga Investors Berhad

Main focus remains on retail & institutional investments, but now incorporating AI, data & risk-hedging approaches similar to global funds.

Two major Malaysian fund management names that are now adding quantitative & derivative strategies — characteristics resembling modern hedge funds.

PROFESSIONAL TRADING HOUSES

Besides individual investors, there are also professional trading firms such as mutual funds and institutional investment companies.

Mutual funds pool money from thousands of investors (including retirement account contributors like 401(k) in the US), and invest in various stocks and bonds to provide stable long-term returns.

They are the largest buyers of stocks and bonds in the world, making them among the most influential players in modern markets.

3 Key Examples of Professional Trading Houses:

— major institutions that trade at scale either for institutional clients or their own accounts (proprietary trading):

1. Jane Street Capital (USA)

One of the most renowned trading houses in the world.
Focus: proprietary trading, ETF arbitrage, and market making.
Known for using mathematics, statistics & AI in trading strategies.
Actively involved in global markets — equities, bonds, currencies, and derivatives.

2. DRW Trading (USA / Singapore)

Founded by Don Wilson.
One of the major prop trading houses with operations in Chicago, London, and Singapore.
Focuses on futures, options, cryptocurrency, and fixed income.
Has its own crypto trading arm called Cumberland.

3. Optiver (Netherlands / Global)

One of the oldest market makers and trading houses (since 1986).
Focus: high-frequency trading (HFT) and market making in equity, derivative, and ETF markets.
Main offices in Amsterdam, Chicago, Sydney, and Hong Kong.
Known as the "silent liquidity provider" across many global exchanges.

Bonus (Asia)

Flow Traders (Netherlands/Singapore) – focuses on ETFs and derivative products, active on Asian exchanges.
Jump Trading (USA/Singapore) – renowned in quantitative trading and ultra-fast strategies (HFT).

Retail Investors Are Not Powerless — They Have Plenty of Advantages Too

Although the market is dominated by "sharks" — investment banks, hedge funds, and algo traders — retail investors actually still have unique advantages:

Advantages of Retail Investors Compared to Big Players:

High Flexibility – Retail traders can enter and exit the market quickly without moving prices. Hedge funds need time and large positions to change their stance.
No Pressure from Clients or Reports – You do not need to report monthly performance to investors. You can wait for the best opportunities without pressure.
Quick Adaptation – Small traders can switch strategies or markets (for example, from stocks to crypto) within a day — something impossible for large institutions.
Current & Open Information – Social media, TradingView, and technical analysis data now provide equal access to everyone.
Opportunity in Tracking the Sharks – Small traders can "follow the footprints" of sharks by reading their traces on price charts (volume, breakouts, order flow).

In summary, the modern market is indeed dominated by algorithms and large institutions. But in wisdom and speed of adaptation — small traders can be more agile than giants.

In this era of open information, the real advantage is no longer about capital size — but about discipline, market understanding, and the ability and skills to read shark behaviour.

"Stock Market Shark Secrets: When They Buy, You Can Enter Too — Without Becoming Prey"

You have heard the term shark in the stock market.
In the article above, 5 types of sharks were identified — investment banks, hedge funds, CTAs, HFTs, and trading houses — that often drive major movements in the market.
Without them, the market would be "quiet and lifeless."

So, as a retail investor, what is your strategy? Fight them? Or follow their footprints wisely?

This is where PakejGold Mahersaham comes to help.

With the "Shark Indicator Technique" module + Institutional Technical Analysis Indicator — you do not need to guess market direction randomly. You will learn:

How to identify large volume (volume spikes) that signal entry by major institutions
Candlestick patterns / breakouts commonly used by algorithmic traders / CTAs / HFTs
Price action + momentum + liquidity zones "favoured" by sharks
Order flow footprint clues & volume divergence for early detection
When the ideal entry position is so you ride the shark''s wave, not swim against it

With this knowledge, you as a retail investor will transform from a "passive spectator" to a "strategic player" — following the sharks'' moves, not fighting the waves.

Who should join PakejGold Mahersaham?

Day traders / intraday traders who want to read institutional footprints
Swing traders who want to enter after institutions start "accumulating"
Medium-term investors who want to know when to enter and exit while sharks are active

Subscribe to your Gold Package here, and access the Mahersaham Shark Indicator to track big volume from institutions: /akauncds

Don''t have a CDS Account yet? Want to trade the US market? You need a CDS Account. Open one with us — details at /akauncds

Elevate Your Investment Knowledge

Successful investing starts with solid knowledge. Continue your learning journey.

Investment Basics:

Want to learn from scratch? Download our free ebook for a complete guide.

Open a CDS Account:

Ready to start? Open a CDS account and put what you have learnt into practice.

Also Read:

Avoid the 5 common newbie mistakes in the stock market.