2 hrs ago
BSE Investors Await Clarity as CAS Replaces VWAP
BSE investors are worried about a system called CAS.
CAS is used to help determine stock closing prices.
Some investors hope the older VWAP system will return.
However, SEBI is unlikely to reverse the change.
CAS was introduced because VWAP had a possible weakness.
Large traders with substantial funds could influence the closing prices of certain stocks under VWAP.
This was especially important for stocks with large weights in an index.
SEBI has noted the trading community’s concerns, but the article says it still favors keeping CAS.
BSE investors are anxious about the continued use of CAS.
SEBI has acknowledged concerns raised by the trading community.
SEBI is unlikely to return to the previous VWAP system.
CAS was introduced to address a weakness associated with VWAP.
VWAP allegedly allowed large traders to influence closing prices of heavily weighted stocks.
- Who
- BSE investors, the trading community, SEBI, and large institutional or non-institutional traders are involved.
- What
- Investors are concerned about CAS, while SEBI is unlikely to restore VWAP.
- Where
- The issue concerns trading on the BSE and stocks included in an index.
- When
- Why
- CAS was introduced to prevent large traders from influencing closing prices of heavily weighted stocks, a concern associated with VWAP.
Investor concerns
Regulatory rationale
Whether VWAP should return
Investor concerns
Some BSE investors are anxious about CAS and see a possible return to VWAP as a glimmer of hope.
Regulatory rationale
SEBI is unlikely to revert to VWAP because CAS was introduced to address VWAP’s perceived weakness.
Influence over closing prices
Investor concerns
The article reflects concerns from the trading community about the current CAS system.
Regulatory rationale
SEBI’s rationale is that VWAP allowed large institutional or non-institutional traders with deep pockets to influence the closing prices of heavily weighted stocks.
Key facts
- Affected investors
- BSE investors
- Current system
- CAS
- Earlier system
- VWAP
- Regulator
- SEBI
- Investor concern
- The trading community has raised concerns about CAS.
- Reason for CAS
- To address the ability of large traders to influence closing prices under VWAP.
- Most affected stocks
- Stocks with significant weightage in an index
Sources
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