Sebi proposes new CAS framework, two options for expiry-day settlement

The Securities and Exchange Board of India, or SEBI, has proposed a new framework for the Closing Auction Session, which includes two options for how derivatives settlement prices are determined on expiry days. This change aims to improve the process of settling derivatives contracts, which are a key part of the Indian stock market. The new framework will give market participants a choice between two methods: a blended volume-weighted average price approach, or the current continuous trading session volume-weighted average price method.

Why it matters

The proposed changes to the Closing Auction Session framework may improve market efficiency. This could lead to increased investor confidence in the Indian stock market.

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