The old closing price system could be influenced by large trades near market close. CAS aims to improve price discovery and strengthen investor confidence.
What Has Changed?
Cash trading in F&O stocks now ends at 3:15 PM, followed by a structured closing auction. F&O derivatives continue trading until 3:40 PM.
How Does CAS Work?
The exchange matches all eligible buy and sell orders at a single equilibrium price, where the maximum trading volume can be executed. This becomes the official closing price.
Benefits of the New System
CAS improves price transparency, reduces end-of-day manipulation, strengthens settlement prices, and aligns India's markets with global exchanges.
Early Market Impact
Initial trading sessions saw higher closing volatility and increased volumes as institutional activity shifted to the auction window, changing end-of-day market behaviour.
What It Means for Investors
Long-term investors benefit from more reliable closing prices, while active traders need to adapt to revised market timings and auction-driven price movements.
Want to understand how SEBI's new Closing Auction Session affects trading, settlement prices, and your investments? Read the complete article for a detailed analysis.