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ASM or “Additional Surveillance Measure” as they are also known, are a means to regulate and monitor the trading habits or activities of particular securities in detail. The primary aim of ASM is to help enhance stock market integrity, reduce the chances of risk, and above all, protect the interest of the investors.
The ASM is an initiative implemented by SEBI (Security Exchange Board of India). Under this provision, certain stocks are moved under ASM according to criteria under the National Stock Exchange (NSE). These stocks are then divided into two categories; long-term ASM and short-term ASM.
For investors, it is important to know the ASM status of the stock they are planning to invest in before making a decision.
Explore: ASM TECHNOLOGIES LTD
The stock market uses ASM to help identify stocks based on predetermined parameters. These parameters include aspects like price volatility, market capitalization and trade volumes. Once these stocks are identified, they are looked at with an even bigger lens. These stocks are subjected to stricter margin requirements, excellent monitoring, and increased disclosure duties as well.
The main intention of the ASM is to ensure market stability and it does this by identifying and then blocking the stocks that are suspected to be indulging in price distortions or various manipulations. With ASM in place, market price swings and risks linked to certain stocks go down to a great extent, making the market a safer place for investors.
Additional Read: Understanding ASM and GSM in Stock Trading | BSE & NSE
There are quite a few ASM in the stock market. Here is a list of some of the most common ones that are used in the stock market.
As an investor, it can be hard to find your stocks under the ASM list. So here are a few steps you can follow to figure things out.
The stock market uses ASM to make it safer for investors at every turn by monitoring parameters like price volatility, market capitalization and trade volumes of certain securities. However, even with the safety net of the ASM at play, it is still crucial that investors do their homework when it comes to the kind of stocks they want to invest in.
Disclaimer: Investments in the securities market are subject to market risk, read all related documents carefully before investing.
This content is for educational purposes only. Securities quoted are exemplary and not recommendatory.
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