Regulation Surveillance

Surveillance measures and trading risks

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SEBI / NSE / BSE operate several surveillance frameworks to maintain market quality. For traders, each framework creates specific risks:

Surveillance frameworks overview

FrameworkFocusRisk for trader
ASM (Additional Surveillance Measure)Price-volume anomaliesHigher margin, T2T, restricted trading
GSM (Graded Surveillance Measure)Fundamental quality concernsT2T, tight price band
Trade-to-Trade (T2T)Delivery-only segmentNo intraday
Periodic Call Auction (PCA)Illiquid / restricted scripsDiscrete-interval matching
Circuit filtersDaily price band capsLocked at circuit price

Risk-management implications

For each surveillance level:

  • Exit difficulty rises.
  • Spreads widen.
  • Margin requirement increases.
  • Intraday capability reduced.

Pre-trade research

Before trading in mid / small-cap or surveilled scrips:

  1. Check ASM / GSM status.
  2. Verify segment (EQ vs T2T).
  3. Check circuit limits.
  4. Review recent corporate-action history.

Effect on holdings

If a held scrip enters surveillance:

  • Existing positions remain.
  • Selling via CNC still works.
  • Exit liquidity may degrade.

See also

External references

References

  1. SEBI, Market surveillance framework, sebi.gov.in.
  2. NSE / BSE, Surveillance circulars, exchange websites.

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The WebNotes Editorial Team covers Indian capital markets, payments infrastructure and retail investor procedures. Every article is fact-checked against primary sources, principally SEBI circulars and master directions, NPCI specifications and the official support documentation published by the intermediary in question. Drafts go through a second-pair-of-eyes review and a separate compliance read before publication, and revisions are tracked against the SEBI and NPCI rule changes referenced in the methodology section.

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