Understanding Graded Surveillance Measures (GSM) in Stock Trading

What are Graded Surveillance Measures (GSM) in stock trading?

SEBI and Exchanges, after joint surveillance discussions, have introduced Graded Surveillance Measures (GSM) to monitor stocks. These measures address securities where the price isn't in alignment with the company's financial health and fundamentals, including factors like Earnings, Book value, Fixed assets, Net worth, P/E multiple, and Market Capitalisation.


Understanding the GSM stages:


Stage
Stage Surveillance Actions
I
  1. Applicable margin is 100%.
  2. Price band of 5% or lower as applicable.
II
  1. Trade for Trade with a price band of 5% or lower as applicable.
  2. Additional Surveillance Deposit (ASD) of 50% of trade value to be deposited by the Buyers
III
  1. Trade for Trade with a price band of 5% or lower as applicable.
  2. Trading permitted once a week (Every Monday or 1st trading day of the week).
  3. ASD (100% of trade value) to be deposited by the Buyers.
IV
  1. Trade for Trade with a price band of 5% or lower as applicable.
  2. Trading permitted once a week (Every Monday or 1st trading day of the week).
  3. ASD (100% of trade value) to be deposited by the Buyers with no upward movement.

Points to be noted:

  1. Scrips in GSM stages II, III, & IV are blocked for Intraday and CNC/Delivery.

  2. In stage I, scrips can be bought in Delivery/CNC; Intraday/CO/BO is restricted.

  3. Scrips under GSM have a 100% haircut; you won't get collateral for pledging them.


For a comprehensive understanding about GSM, refer to this NSE FAQ series.

To explore the list of GSM stocks, click here.

    • Related Articles

    • What are Additional Surveillance Measures (ASM)?

      To enhance market integrity and protect investor interests, the Securities and Exchange Board of India (SEBI) and stock exchanges implement Additional Surveillance Measures (ASM) on stocks that show significant surveillance concerns. These concerns ...

    • What happens to buy and sell orders when a stock hits the upper or lower circuit?

      When a stock hits the upper circuit, it has reached its maximum allowed price increase for the day, leading to a trading halt. During this time, only bid orders (intentions to buy) exist without any corresponding ask orders (intentions to sell), ...

    • What is FYERS RMS policy for trading?

      At FYERS, we believe in fostering a safe and efficient trading environment. As part of our commitment to safeguarding your interests, we have set forth a comprehensive Risk Management System (RMS) policy. Here's a breakdown: RMS Policy on Options ...

    • What will happen to my Intraday position if the stock hits the circuit limit?

      Equity Intraday trading lets you leverage your positions—buying or selling stocks up to five times your account balance. However, these positions must be squared off on the same day. If they aren't, we aim to close them around 3.15 PM. Occasionally, ...

    • Is trading in Far OTM options possible on FYERS?

      Yes, we offer a broad strike price range, enabling you to Buy/Sell Far Out of The Money (OTM) Options Contracts. Options Buying: Index Options: You can purchase OTM Options within a range of 20% from the Last Traded Price (LTP). Stock Options: ...