The Bombay Stock Exchange (BSE) is likely to implement a call auction in the pre-open session from mid-October to reduce price volatility and better price discovery, a senior exchange official said today.
“The exchange is talking to the market regulator, Securities and Exchange Board of India (Sebi) for introduction of call auction in pre-open session, and it is expected to go live in mid-October,” BSE’s head-product strategy, Sayee Srinivasan, told PTI here today.
Initially, the call auction session will be applicable for Sensex 30 and Nifty 50 scrips, Srinivasan said, adding that more scrips would be gradually added in the list.
The BSE had stopped call auction in the mid-90s.
Last month, Sebi had said a pre-open session with a call auction facility for the Sensex and Nifty stocks would be introduced on a pilot basis by both the BSE and National Stock Exchange.
The pre-open call auction session will be for 15 minutes between 9 am and 9.15 am. While the first eight minutes will be reserved for order entry, modification and cancellation, the next four minutes will be kept for order matching and trade confirmation. The last three minutes will be the buffer period to facilitate the transition from pre-open session to the normal market.