Is Grey Market, Kostak & “Subject to Sauda” Different?

Define Grey Market, Kostak & “Subject to Sauda”

The Indian stock market is a complex system with several types of market participants. IPO In the Share Market refers to an Initial Public Offering when a company first sells shares to the public. 

  • Grey Market is an Online Trading market where unlisted securities are traded. The Grey Market allows investors to get a hold of these securities before they are officially listed.
  • In the Grey Market, Kostak – also known as the price of the application, is the premium at which IPO applications are being traded for a premium price. Selling IPO applications before they are allotted or listed makes Kostak rates.
  • ‘Subject to Sauda’ is usually used in the IPO Grey Market, where investors trade shares before they are officially listed on the Online Share Trading stock exchange.

Therefore, an IPO that is ‘Subject to Sauda’ will usually have a higher price than one that is not, as there is more risk involved for the investment banks. 

Differentiate Between the Three – Comparison Made Easy!

  1. Grey Market is a market where unlisted securities are traded, both online and offline, before they are officially listed on an exchange. It is not regulated by any exchange or authority but is still subject to general securities laws and regulations. 

However, it can also be a way to get in on a good investment early. The downside is that there is no regulation in the Grey Market, so you could end up losing your investment if the company does not perform well.

  1. Kostak is the premium at which IPO applications are traded before they are allotted or listed. In the Grey Market, investors can trade shares before they are officially listed, but there is no guarantee that the shares will be listed on the exchange.
  1. Subject To Sauda” is a method of trading shares in the IPO Grey Market where investors agree to buy shares at a set price, but the transaction is only finalised when the IPO is listed on an exchange. 

Grey Market is an unregulated market where shares are traded before they are officially listed on an exchange. Kostak and “Subject to Sauda” are options for investing in an IPO after it is officially listed, with Kostak allowing for the purchase of shares at a set price and “Subject to Sauda” allowing for a purchase agreement with a final price to be determined once the IPO is listed.

Which Type is Best to Go for Investors in Listing Make Money?

Your risk tolerance and investment goals determine which option you choose. For example, grey Market Equity Trading may be a good option if you want to get in on a good investment early. 

However, if you are more concerned with minimising risk, Kostak or “Subject to Sauda” may be better choices. You can use the Shoonya app to decide Who Is Stock Market King between the Grey Market, Kostak, and Subject to Sauda. Shoonya is the Best Site for Investing In Stocks and opening Zero Brokerage Demat Account Intraday.