Index fund X holds five stocks: a, b, c, d, e. The crowd is dumping X and selling a–d, but buying e directly. Drag the sliders to see how E gets pulled in two directions at once — and which force wins.
Redemption chain idle — X is near its NAV, nothing leaks to the basket.
The insight: a, b, c, d only feel selling — from both the crowd and the basket
redemption, pointing the same way. E is unique: direct buyers push it up while the basket
redemption drags it down. E's price ≈ its own demand − its share of the basket being dumped.
In normal conditions direct demand wins and E rises (just less than it would alone); only in an
extreme X selloff does the basket drag flip E negative.