NSE to introduce new method for closing price discovery through Closing Auction Session from tomorrow

The National Stock Exchange (NSE) is set to introduce a new method for closing price discovery through the Closing Auction Session (CAS) from tomorrow. The new system will change the way closing prices are determined for eligible Futures & Options (F&O) stocks in the cash market, with the aim of improving price discovery and aligning Indian markets with global practices.
 
Under the new framework, non-F&O stocks will continue regular trading until 3:30 pm, with no change in their trading schedule. Stocks included in the F&O segment will see continuous trading until 3:15 pm, followed by the Closing Auction Session from 3:15 pm to 3:35 pm. Stock and index F&O trading will continue until 3:40 pm.
 
This move will extend equity derivatives trading by 10 minutes, resulting in different closing times across market segments. The extension of F&O trading hours is aimed at creating a smoother link between the cash and derivatives markets, while enhancing efficiency and improving the accuracy of closing price determination.
 
Previously, closing prices were calculated using the Volume Weighted Average Price (VWAP) of trades executed during the final 30 minutes of the trading session.