The National Stock Exchange (NSE) on February 2 put three Adani stocks, namely, Adani Enterprises, Adani Ports, and Ambuja Cements, under the additional surveillance measure (ASM) framework from February 3, 2023.
Here’s all you need to know about additional surveillance measure
An additional surveillance measure (ASM) was introduced by the Indian market regulator SEBI and the bourses as a risk containment and surveillance measure in 2018 to monitor highly volatile stocks.
It is an initiative to enhance market integrity and safeguard the interest of investors. By putting stocks under ASM, exchanges also serve as a warning to investors to keep a tab on unusual price movements.
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Stocks under ASM get monitored for factors such as volatility and price fluctuation. However, the bourses say such action is purely part of market surveillance, and should not be regarded as action against the entity.
Shortlisted stocks are monitored on pre-determined objective criteria and are moved into Trade for Trade segment once the criteria are satisfied.
The criteria for shortlisting securities to be placed in ASM cover the following parameters:
When placed under ASM, the entire traded value will get blocked as margins, that is, intraday leverage is not given.
Corporate actions, such as bonuses and dividends are not impacted if a stock is placed under ASM.
However, if a person has already pledged a stock that has been moved under ASM, they will cease to get collateral margins for that stock. In such case, the stock can be unpledged or kept without collateral till it is taken out of ASM.