Skip to main content

Market Pre-open session - How It works and Its benefits

   With an intention to reduce volatility in various scrips at the opening of the markets, and to arrive at the ideal opening price of a scrip, the exchanges have introduced a call auction process in the pre-open session from October 18.

   The pre-open session is a new innovation to arrive at the ideal opening price of a scrip for the current trading session. The session intends to reduce volatility in the beginning of a day. Under this new arrangement, an exchange will collect orders for the first few minutes of this session. On the basis of orders received, it will arrive at the opening price and match the tradable orders to that price. The remaining orders will be moved to the normal trading session.

   The call auction process will be initially introduced for scrips forming part of Nifty and Sensex, and trading in other scrips and F&O contracts will only begin at 9:15 am when normal market trading begins. Orders not will get traded during the order entry period in the pre-open session.

   The duration of the pre-open session will be 15 minutes - from 9 am to 9.15 am.

   The session will have three phases:

Order entry period    

The order entry period is 9 am to 9.08 am. The buyer can place new orders, modify or delete old orders. The order entry can stop randomly between the 7th and 8th minute.

Order matching and confirmation period (price discovery period)    

This period is from 9.08 am to 9.12 am. The exchange arrives at the opening price and trades the matchable orders at the opening price. The client cannot modify or delete the orders during this period.

Buffer period    

This is from 9.12 am to 9.15 am. This period is used as a transition period between pre-open and continuous trading sessions.

   Then the regular market - 9.15 am to 3:30 pm - hours begin.

Trading    

The orders that have not been traded are carried forwarded to the normal trading session. Limit orders that are not traded during pre-open sessions will be moved to normal trading sessions at the same price. Market orders that are not traded during pre-open sessions will be moved to normal trading sessions at the opening price.

   Orders are traded in the second phase - order matching and confirmation phase - of the pre-open session. You will receive trade confirmations during that phase only - tentatively between 9.08 and 9.12 am.

   If the opening price is not discovered during a pre-open session, the market orders will be shifted to the normal trading session at the previous day's closing price.

   Presently, you can only place orders in scrips that form the Nifty and Sensex indices. This list is subject to change and will be notified by exchanges accordingly. You can place an order in any product (cash, intraday or margin) during a pre-open session. Pre-open session is not available in the F&O segment. You cannot place fresh offline orders or modify existing offline orders during a pre-open session.

   Also, you cannot place an order beyond plus or minus 20 percent of the previous day's closing price. For example, if the closing price of a scrip is Rs 200, you cannot place an order beyond Rs 160-240 price range during a pre-open session.

   You may view the tentative opening price for a scrip in the 'LTP' field during a pre-open session.

Order books    

For pre-open sessions, the order book of a scrip in the NSE and BSE need to be interpreted differently.

In the NSE    

The NSE order book will have four limit order legs and one market order leg on both bid and offer sides. The last leg of the order book on either side will be for market orders. All the market orders placed by you will come under this leg.

   Each limit order leg will show the exact price and quantity available on that price. For market order leg, the order book will display price as '0' and quantity as total quantity of the market orders on that side.

In the BSE    

The BSE order book will have all limit order legs and each leg will display the cumulative tradable quantity at that leg.


   Market orders will not be treated separately in the order book.

 


Popular posts from this blog

ICICI Prudential Dynamic Plan Invest Online

Download Tax Saving Mutual Fund Application Forms Invest In Tax Saving Mutual Funds Online Buy Gold Mutual Funds Leave a missed Call on 94 8300 8300   ICICI Prudential Dynamic Plan             Invest Online This fund does remarkably well during falling markets, but fails to show the same prowess during a rising market. The fund sticks to its mandate to adapt to the dynamic nature of the market by shuttling between debt and equity. It takes aggressive asset calls in equity when the market surges by investing in quality mid-cap stocks. At the same time, it adopts a defensive strategy by investing in debt and cash when markets get overvalued, making it a good long-term choice.     For further information contact Prajna Capital on 94 8300 8300 by leaving a missed call     Leave a missed Call on 94 8300 8300   Leave your comment with mail ID and we will ...

Lump Sum or SIP?

Invest Mutual Fund Online     You have a lump sum in hand and you wish to invest in equity funds. However, you have heard a lot of talk about investing in equity funds through Systematic Investment Plans (SIPs) because they help average costs, ensure you do not ill-time the market, and help you invest in small sums, besides giving you many other advantages. So, should you invest the money you have in hand in one go, or let it remain in your bank account and then do an SIP? There is no harm in investing a lump sum amount. For all you know, compounding, over the long term, could work better with lump sum. However, make sure you fulfill all of these three criteria if you want to invest in one go. Else, SIP is the way to go. #1: You invest for the long term According to past data, ideally, if you have a time frame of 12 years or more, you can consider lump sum investing (provided you satisfy the other two conditions that follow). So, what is the sanctity behind 12 years? Is it because only...

ICICI Lombard to provide weather cover in 10 states

ICICI Lombard General Insurance Company has been given the mandate to provide weather-based crop insurance for rabi season (2010-11) in Madhya Pradesh, Bihar,Tamil Nadu, Karnataka, West Bengal, Chhattisgarh, Jharkhand and Himachal Pradesh.    The insurance company will cover 69 districts — 30 loanee districts (farmers who have taken loans) and 39 non-loanee districts. The major crops that ICICI Lombard covers for the season are winter paddy, cotton, wheat, mustard, barley, maize, onion, potato, tomato, lentil, peas, arhar, jowar, fenugreek, coriander, cumin, methi, isabgol, brinjal among other crops.    Weather-based crop insurance provides cover against weather-related risks such as excess or deficit rainfall, variations in temperature and fluctuations in humidity. This scheme facilitates immediate compensation based on certified data collected from independent third party bodies such as Indian Meteorological Department ( IMD ) and National Collateral Management Services Ltd. ( NC...

Mutual Fund Review: Reliance Regular Savings Balanced

Reliance Regular Savings Balanced fund has shown great resilience during market crash After a shaky start, this fund has established itself as a strong contender in this space. In the past three years it has ridden the market well by not only delivering during the market run-ups but also displaying resilience during the crash. In 2008, it witnessed the second lowest fall among its category and last year it was amongst the top three performers with a return of 76 per cent (category average: 61%).   The poor underperformance in 2006 can well be credited to the low equity allocation of the fund, which stood at just over 10 per cent for only four months that year. Though the fund has the leeway to go up to 75 per cent in equity, it has never touched that limit. In fact, it has exceeded 70 per cent in just five months in its entire history. During the crash of 2008, the fund managers had no problem going right down to 54 per cent (equity exposure). Fund managers Omprakash Kukian and A...

ICICI Prudential Mutual Fund Dividend

ICICI Prudential Mutual Fund   has announced dividend under the following schemes: Scheme Dividend (Rs/unit) ICICI Pru FMP Series 72 370D Plan G-D 0.03611325 ICICI Pru FMP Series 72 370D Plan G Direct-D 0.03611325 The record date has been fixed as February 15, 2017. ------------------------------ ------ Invest Rs 1,50,000 and Save Tax upto Rs 46,350 under Section 80C. Get Great Returns by Investing in Best Performing ELSS Funds Top 4 Tax Saver Mutual Funds for 2017 - 2018 Best 4 ELSS Mutual Funds to invest in India for 2017 1. DSP BlackRock Tax Saver Fund 2. Invesco India Tax Plan 3. Tata India Tax Savings Fund 4. BNP Paribas Long Term Equity Fund Invest in Best Performing 2017 Tax Saver Mutual Funds Online Invest Best Tax Saver Mutual Funds Online Download Top Tax Saver Mutual Funds  Application Forms For further information contact  SaveTaxGetRich on 94 8300 8300 ------------------------------ ------ Leave your comment with mail ID and we will answer them OR You can write to us at I...
Related Posts Plugin for WordPress, Blogger...
Invest in Tax Saving Mutual Funds Download Any Applications
Transact Mutual Funds Online Invest Online
Buy Gold Mutual Funds Invest Now