SEBI finds no CAS manipulation as mutual fund participation rises
SEBI checked out the recently launched closing auction sessions (CAS) for stocks and found no signs of price manipulation.
The CAS, which replaced the old VWAP system on August 3 for 208 derivative-traded stocks, was meant to make prices more accurate and fair.
Interestingly, mutual fund participation in these sessions was 5-7% earlier and is now almost 25%.
CAS criticized for low trading activity
Even with more players joining in, CAS has faced criticism for low trading activity, which led to wild price moves, like the Nifty50 surging 1.6% on day one, driven by a 200-point jump in the final two minutes of the order-closing period.
SEBI chief Tuhin Kanta Pandey is encouraging more people to take part so prices settle down and stay transparent.
For now, trading volumes are down as everyone gets used to this new system.