Sebi's New Closing Auction Session Proposal Aims to Revolutionize Equity Cash Market
Sebi proposed a new framework for the Closing Auction Session (CAS) in the equity cash market, starting with highly liquid derivative stocks. The aim is to reduce volatility, improve fairness, and facilitate trades for large and passive investors. Public comments are sought until September 12 on this proposal.
- Country:
- India
The Securities and Exchange Board of India (Sebi) has unveiled a proposal for a revamped Closing Auction Session (CAS) in the equity cash market. Targeting highly liquid derivative stocks initially, the plan is expected to foster reduced volatility and greater trade fairness, subsequently benefiting large and passive investors.
Under the consultation paper, CAS would initially apply to derivative segment stocks with ample liquidity, eventually extending to other stocks based on feedback and experience. Sebi purports that CAS offers a more stable closing price compared to the existing Volume Weighted Average Price (VWAP) method.
Feedback is being sought until September 12, with the regulator's Secondary Market Advisory Committee already aligning with some proposed changes. Sebi's move towards CAS hints at a future where equity trading is more transparent, fair, and accessible for institutional investors.
(With inputs from agencies.)
Google News