SEBI Proposes Closing Auction Session for Derivative Stocks
Why in the news
SEBI wants a short end-of-day auction to make closing prices steadier, beginning with derivative stocks.
Key facts
- Purpose: one closing price with less volatility and manipulation at the close.
- Traders place buy or sell orders during the window.
- Unmatched orders carry to the next trading day, subject to exchange rules.
- The window falls in the last few minutes of the session; length varies by exchange.
Importance
- Transparent, fair price discovery.
- Used for portfolio valuations, index calculation and NAVs.
- Exchanges named: NSE and BSE.
Exam angle
- Full form: Closing Auction Session.
- Proposed by SEBI.