Sebi chair rules out CAS rollback; assures commitment to resolving ongoing issues
The Securities and Exchange Board of India is set to assess the implications of the newly implemented Closing Auction Session. Chairman Tuhin Kanta Pandey affirmed that this mechanism will remain in place and will undergo enhancements. Designed to ascertain closing prices for stocks in the futures and options market, the system has faced scrutiny from market participants who have reported losses.
Mumbai-based Securities and Exchange Board of India (Sebi) Chairman Tuhin Kanta Pandey dispelled rumors of scrapping the Closing Auction Session (CAS) mechanism during a discussion at the Sebi's Symposium on Cyber Defence event in Mumbai. Despite some market participants' concerns, Pandey affirmed that Sebi will not abandon the new CAS but will thoroughly examine the issues raised and decide on necessary adjustments.
Pandey clarified that the CAS, introduced since August 3, aims to reduce the impact of large orders on closing prices by auctioning the closing rates for around 200 stocks in the futures and options segment for approximately 20 minutes. However, the new system has faced uncertainty, as losses in F&O trades have led to protests from traders and other participants.
Sebi is currently reviewing feedback from market participants, discussions on social media, expiry-day data, and other suggestions to determine whether any changes are needed to improve the system. Pandey cautioned against creating unnecessary concerns around its functioning, emphasizing that the CAS cannot be monitored on a daily basis. He stressed the importance of providing traders with indicative prices, which play a crucial role in their decision-making process.
Written by urgent.news from The Economic Times - Top News's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
