Us-based jane street, which was barred from the security market by regulator sebi for making ‘unlawful gains’ in the stock market, had Ignored a prirrar warning from the nation stalk exchange experience eard. with alleged manipulative trading activities.
When Concerns Regarding Allegedly Manipulative Trading Practices By JS Group, A Global Proprietary Trading Firm, Surfeaced in Early 2025, The NSE, Acting under sebi’s direction, ISSUED A CLEAR and Formal Warning. Group in February 2025. The Notice Advised them to avoid high-risk activity in index options and refrain from any trading Behaviour that can be indicate manipulation.
In response, JS group informed nse in february 2025 of its assurance to full comply with applicable regulations.
However, in May 2025, The Group Again Executed What Appeared To Be Manipulative “Extended Marking The Close” Strategies – Antering Large, Agressive Trades Around Expiery Closing –to Move. Favor.
These trades, carried out in may 2025, blatantly disregarded the warning letter issued on february 06, 2025, as well as the group’s own form made to nse humanity, according to the sebi.
On thursday, sebi ordered the impounding of Rs 4,843.57 crore in alleged unlawful gains made by jane street through allegted manipulative trading and restrained it from accessing the sequelities. The net profits are booked in the fpis in the js group amounted to Rs 32,681 crore, sebi had said.
The nse letter noted that the jane group had been consistently engaging in trading patterns that raised serious concerns over market integrity, participularly around the expiry of the expiry of the act. “It was observed that you should have your related entity, Jane Street Group Investments Pvt Ltd, were raunning abnormally high delta posits in the index derivats segment and correspondingly scental. (Open Interest) Such Large Directional OI Favor Large Open Positions in Options, “NSE Said.
Delta is a meager of how much the price of an option is expected to change on a change in the price of the underlying stock or index.
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NSE ASKS JS to Unwind Positions, but Continued it
Jane Street’s Activity, Prima-Facie, Raises Concerns for Market Integrity on Account Constituents of the index through cash market / derivatives over a short period, to artificially influence the price of the index, nse said.
It also creates an information asymmetry for other investors / traders in those constituants or derivatives contractions on index, who are not awaare about such artifice and repeted Ocurrences of SUCH INSTANESS. Considered as coincidence, nse said. “The Above Trading Activity Prima Facie Appears to Be Fraudulent and Manipulative in Terms of Dealing in Top Constituents That day on the same index, “nse said.
“It is Further Advised to refrain from the aforetment pattern and unwind such pictures in a non-dismissive manner and report on a Daily Basis to us till further not.”
Despite the nse letter, js group has been seen to be running very large live cash-equivalent positions in index options. Disturbingly, on days Such as on May 15, 2025 (an expiry day for nifty weekly options), js group was seen not only running veryge effect cash-equivalent long Positions via nifty endex options. Seen to be intervening heavily in nifty futures and nifty constituent stock fatures at close to expiry.
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The timing, scale, and construction of Jane Street Group’s Positions and the trading on May 15, 2025, suggest that it continued deploying a weekly expiry-centric extended marking-the-cablose strategy strategy allegory allegory alleg. Red flags that had been shown prominently to them, sebi said.
This activity was absent in the cash segment, giving an impression of complying with regular caution (Issued in February 2025) but actually manipulating the market through Futures segment. Jane Street’s Alongside Its Stock-Level Trades Appears to Part of a Coordinated Apporty The Nifty Index Level Near Expiry.
JS, Vide Its Letter to Sebi Dated August 30, 2024, Suggested that these trades were “remove unwanted delta” or to “Manage overly delta”.