Gilt Players Take Fancy To Illiquid Papers

Players in the government security market -- banks and primary dealers -- turned to illiquid papers following an extreme rise in prices of liquid papers.

The market, which was range-bound since the beginning of the current month, observed fresh buying interest today as the liquidity situation turned comfortable, but this time the rally was for illiquid stocks.

Dealers said the prices of illiquid papers -- 12.29 per cent 2010, 12.25 per cent 2011, 12.32 per cent 2011 -- increased much more than the liquid stocks -- 11.30 per cent 2010, 11.50 per cent 2011. The prices of illiquid papers went up by 15-20 paise, while the appreciation in liquid stocks was only 5-7 paise, dealers said.

 

A primary dealer said,