Short Call: Why retail is ever bullish on single stock futures, the myth of time correction

moneycontrol.com:

"Once a boom is well started, it cannot be arrested. It can only be collapsed."  - John Kenneth Galbraith

Depositors in the doomed-Silicon Valley Bank have been protected, but equity investors and bond holders have been wiped out.  And shortly after US regulators shut down the New York-based Signature Bank citing systemic risk. Signature was one of the main banks to the cryptocurrency industry, the biggest one next to Silvergate, which announced its impending liquidation last week.

Global markets look all set for a bumpy ride over the next few weeks as investors try to guess the next casualty.

Back home, those betting on a ‘time-correction’ all the way till the next leg of upswing could do well to remember the above quote by the noted economist Galbraith. As the Silicon Valley episode shows, there is never an orderly retreat from a bull market. The excesses of the bull market at some point have to be  purged from the system, and a time-wise correction more likely than not ends in a panic bottoming of prices.

Single stock futures

Two closely tracked F&O indicators are the outstanding FII net long/short positions in index futures and the retail investor net long/short position in single stock futures. While FII Nifty positions swing between net short and net long depending on market conditions, retail positions in single stock futures have consistently been net long 70 percent or more.

Why?

A part of these positions is a hedge as part of a derivative trading strategy, but a sizeable portion is funding transactions by promoters of mid-cap companies. The promoters sell shares from their benaami holdings to a financier. The financiers in picture could be wealthy investors or aribitrage schemes of mutual funds.

After buying the