sebi rule update: Sebi, exchanges ease trading rule for stocks under enhanced surveillance framework

MUMBAI – The Securities and Change Board of India (Sebi) in a discussions with the inventory exchanges on Tuesday determined to ease guidelines for buying and selling in shares that stay below the improved surveillance measures (ESM) framework.

Underneath the prevailing ESM framework rule, shares had been allowed to commerce solely as soon as per week. Nevertheless, buying and selling in them will now be allowed on all days, the exchanges mentioned in a round.

In trade-for-trade settlement with a worth band of two%, buying and selling in shares can be allowed on all days. Nevertheless, the rule of 100% margin stays unchanged, the exchanges mentioned.

All different laws below the ESM framework stay unchanged. As a way to improve market integrity and safeguard the curiosity of traders, Sebi and exchanges have taken a number of enhanced pre-emptive surveillance measures corresponding to discount in worth band, periodic name public sale and switch of securities to trade-for-trade phase.

To reinforce this additional, exchanges launched ESM on micro-small firms, with a market capitalisation of lower than Rs 500 crore primarily based on parameters corresponding to worth variation, commonplace deviation and so forth.

There are two phases below the ESM framework – stage I and II – and commerce below trade-for-trade with a 5% or 2% worth band, whichever is relevant.

Buying and selling below ESM framework isn’t thought of as an excessive situation, however a transfer to cut back volatility within the inventory and avert any potential losses to traders. (Disclaimer: Suggestions, solutions, views and opinions given by the consultants are their very own. These don’t symbolize the views of Financial Occasions)