Mumbai, The Securities and Exchange Board of India (SEBI) is analysing concerns raised by traders and other market participants over the new Closing Auction Session (CAS) for futures and options (F&O) eligible stocks but the mechanism is here to stay, Chairman Tuhin Kanta Pandey said on Monday.
The regulator is reviewing feedback from market participants, discussions on social media and expiry-date data before deciding whether any changes are required to improve the system, Pandey told reporters.
“CAS is here to stay. If there are issues that can be improved, they will be done soon,” he said.
The CAS came into effect on August 3 as part of changes in the mechanism for determining closing prices of F&O-eligible stocks.
Under the new system, continuous trading in these stocks ends at 3:15 pm, after which they enter the closing auction. Orders are matched during the auction and the resulting price becomes the official closing price.
Non-F&O stocks continue to trade until 3:30 pm, while stock and index derivatives remain open until 3:40 pm.
Pandey said SEBI was speaking to market participants and assessing the concerns and suggestions received on the new mechanism.
“We are talking to participants on the concerns. We are analysing the issues and will soon come with a view,” he said.
The chairman said it was still too early to assess the overall response to CAS as market participants were adapting to the new process.
“It is too early to say response of participants on CAS,” he said, adding that the regulator would take more time to analyse the mechanism.
Moreover, SEBI is also examining data around expiry dates.
Pandey said the regulator had not found concerns relating to tracking errors under CAS. “There are no concerns around tracking errors in CAS,” he said.
