- A trader claimed that a ₹1 lakh investment in a Sensex put option could have turned into ₹44 lakh in just five minutes during Thursday's closing session.
- The Sensex saw a sharp late-session swing, moving from around 77,200 at 3:17 pm to about 74,983 at 3:23 pm, a move of more than 2,000 points in just a few minutes, then recovered nearly 2,000 points in the next seven minutes, and eventually closed at 76,934, down 539 points from Wednesday's close.
- Reliance Industries, the stock with the highest weight in the Sensex, fell from around ₹1,289 to ₹1,250 in just seven minutes, before recovering sharply to close at ₹1,286.
- The volatility has raised questions about the impact of the new Closing Auction Session on trading near the market close. The Bombay Stock Exchange (BSE) introduced CAS on August 3 as a new method for determining closing prices, with the aim of reducing the possibility of price manipulation.
- A week earlier, Sebi took action against Copthall Mauritius, a JP Morgan-linked entity, over alleged manipulation involving the Sensex and its constituent stocks, barring the entities and ordering them to give up nearly ₹3.8 crore in alleged illegal gains.
- Since CAS was introduced, both the Sensex and Nifty have seen unusually large price movements between 3.15pm and 3.30pm.
- The claim came after the Sensex witnessed an extraordinary swing during the Closing Auction Session (CAS) on the monthly derivatives expiry day.
- The trader's post on X (formerly Twitter) read: "if you have invested 1L in Sensex option > 76500 PE at 3:15 AM and exited at 3:20 PM you would have made 44 lakhs > > 44 times in just 5 min > > Power of CAS 💪🏻"
A trader's claim that a ₹1 lakh investment in a Sensex put option could have turned into ₹44 lakh in just five minutes has sparked significant buzz following a dramatic swing in the index during Thursday's Closing Auction Session (CAS).12345781112
The Sensex experienced a sharp decline, plummeting over 2,000 points from approximately 77,200 at 3:17 PM to around 74,983 at 3:23 PM, before recovering nearly the same amount in the following minutes.
The trader, Vibhor Varshney, noted that if an investor had purchased 76,500 put options at 3:15 PM and sold them at 3:20 PM, they could have realized a profit of around ₹44 lakh. This volatility has raised questions about the impact of the newly introduced CAS, which aims to reduce price manipulation.
The Bombay Stock Exchange implemented CAS on August 3, leading to unusually large price movements during the last 15 minutes of trading.
A week prior, the Securities and Exchange Board of India (Sebi) took action against Copthall Mauritius, a JP Morgan-linked entity, for alleged manipulation involving the Sensex, barring them from market activities and ordering them to forfeit nearly ₹3.8 crore in illegal gains.910
The index eventually closed at 76,934, down 539 points from the previous day's close, with Reliance Industries, the stock with the highest weight in the Sensex, experiencing a drop from ₹1,289 to ₹1,250 before recovering to close at ₹1,286.6
“The Sensex swung from around 77,200 to 74,983 in six minutes before recovering to close at 76,934, down 539 points. Reliance Industries, the index's heaviest weight, fell from ₹1,289 to ₹1,250 in seven minutes, then recovered to close at ₹1,286.”
