If you trade in the stock market, this update is important. Starting August 3, 2026, the Securities and Exchange Board of India (SEBI)
and the National Stock Exchange (NSE) will introduce a Closing Auction Session (CAS) for eligible Futures & Options (F&O) stocks.
Along with this change, the F&O trading session will be extended by 10 minutes, allowing trading until 3:40 PM instead of ending earlier.
New Trading Timings You Should Know
Under the new rules, different market segments will have different closing times.
Non-F&O stocks: Regular trading will continue until 3:30 PM (no change).
F&O stocks: Normal trading will end at 3:15 PM, followed by the Closing Auction Session from 3:15 PM to 3:35 PM.
Stock and Index F&O: Trading will continue until 3:40 PM.
Post-close session: 3:50 PM to 4:00 PM.
This means traders will need to keep track of different closing schedules depending on the segment they trade in.
How Will the New Closing Auction Work?
During the Closing Auction Session, all buy and sell orders will be collected and matched at a single equilibrium price.
This price will become the official closing price for the day. Earlier, the closing price of F&O stocks was calculated using the Volume Weighted Average Price (VWAP) during the final trading period.
The new system is expected to help traders hedge open positions, close intraday trades, manage expiry-day volatility, and make better trading decisions.
Zerodha Co-founder Explains the Benefit
Zerodha co-founder Nithin Kamath said the new system will improve price discovery and make it easier to execute large trades.
According to him, index funds and ETFs will benefit the most because large orders can be executed at one price, reducing tracking errors and lowering the chances of price manipulation at market close.
What is Futures and Options (F&O) Trading?
Futures and Options (F&O) are derivative contracts in the stock market. In these contracts, buyers and sellers agree to buy or sell an asset—such as a stock, index, or commodity—at a fixed price on a future date.
F&O trading is widely used for hedging risk, speculation, and managing investment portfolios.
