How traders allegedly gamed CAS

In today’s Finshots, we talk about the downsides of CAS (Closing Auction Session) and explore whether Indian stock markets can keep manipulation at bay.But here’s a quick sidenote before we begin.

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and Mansi Share and Stock Broking, for allegedly manipulating the SENSEX’s closing price during the CAS, and seemingly minting ₹3.68 crore from it.So let’s understand what happened and whether CAS really is the villain everyone thinks it is.Until July this year, a stock’s official closing price was calculated using the average price (specifically the Volume Weighted Average Price, or VWAP) of all trades in the last 30 minutes of the trading day.But starting this month, SEBI replaced that system with the CAS. Here, regular trading stops at 3:15 PM for stocks with Futures and Options (F&O) contracts. Then a separate 20-minute auction runs until 3:35 PM, much like the pre-open session used to set opening prices.During these 20 minutes, traders get specific five-minute windows to place or modify orders.