What happens to a stock under surveillance?

When a stock comes under exchange surveillance (ASM/GSM), trading in the stock becomes more restrictive to curb excessive volatility and protect investors.

Stricter Margin Requirements: Higher margins are mandated, meaning you need to keep more funds as collateral to trade or hold the stock.

Trade-to-Trade (T2T) Settlement: Every trade results in delivery. Intraday trading and short selling are not allowed.

Reduced Price Bands: Tighter daily price limits (often around 5%) are imposed to control sharp price movements. While this limits volatility, it can also restrict exits.

Restricted Trading Activity: Intraday trading is usually banned. In some cases, trading frequency may be reduced, limiting liquidity.

Investor Alerts & Safeguards: Trading platforms display clear alerts or confirmations before allowing trades. These nudges help investors stay aware of the additional risks and regulatory restrictions.