Know more about ASM!

Shruti Dahiwal
/ Categories: Knowledge, Fundamental
Know more about ASM!

The ASM framework came into force with effect from March 26, 2018.

SEBI, as the regulatory authority of the Indian capital and securities market, lays out various rules and regulations for the protection of investors. In alignment with this, it has formulated various surveillance measures such as Graded Surveillance Measure (GSM), price bands, periodic call auctions and transfer of securities to the Trade for Trade segment.   

Additional surveillance measure or ASM, as the name suggests, is another surveillance measure put into force by SEBI and the stock exchanges for enhancing market integrity and safeguarding the interest of investors. The ASM framework came into force with effect from March 26, 2018. Securities with surveillance concerns based on objective parameters such as price variation, volatility etc. are considered under this framework.   

ASM can be classified into two categories-   

A) Long-term Additional Surveillance Measure (Long-term ASM)  

B) Short-term Additional Surveillance Measure (Short-term ASM)  
 

Criteria  

The shortlisting of securities to be placed in the ASM framework is done by SEBI and the stock exchanges in a joint manner. The shortlisting takes into account various market based dynamic parameters which include -  

  • High Low Variation   

  • Client Concentration   

  • Close to Close Price Variation   

  • Market Capitalization    

  • Volume Variation   

  • Delivery Percentage  

  • No. of Unique PANs   

  • PE  

 
Exceptions  

The ASM framework has some exceptions. It excludes the following from the process of shortlisting-  

  • Public Sector Enterprises and Public Sector Banks   

  • Securities that are already under Graded Surveillance Measure (GSM)   

  • Securities on which derivative products are available   

  • Securities that are already under Trade for Trade  

 

Is it something to be worried about?  

No. Investors need not fear about securities that have come under the ASM framework as the shortlisting is done solely on account of market surveillance and it should not be perceived as a negative action against the particular company. 

 

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