Additional Surveillance Measure (ASM)

## What ASM is The Additional Surveillance Measure is a market-integrity tool run by SEBI together with the NSE and BSE. When a stock shows unusual behaviour — sharp price swings, abnormal volumes, high volatility, a stretched price-to-earnings or close-to-close move, or a concentration of clients — it can be placed under ASM. The aim is to alert investors and curb excessive speculation before it turns into manipulation or a pump-and-dump.

## How it works ASM comes in two forms: short-term ASM and long-term ASM, each with stages (I–IV) of escalating strictness. Being placed under ASM can trigger measures such as a higher margin requirement (sometimes 100% of trade value), a move from rolling settlement to trade-for-trade (no intraday netting — you must take delivery), reduced price bands, and periodic call auctions instead of continuous trading. These curbs make it costlier and slower to trade the stock, deliberately cooling speculative interest.

A related, stricter list is the GSM (Graded Surveillance Measure), aimed at fundamentally weak or suspicious micro-caps. The two frameworks overlap in purpose but ASM is more about volatility, GSM more about questionable fundamentals.

## Why it matters to you If a stock you hold or want to buy is under ASM, expect higher margins, possible delivery-only settlement, and tighter bands — and treat it as a flashing caution light. ASM placement does not mean the company is fraudulent, but it does mean the exchange has noticed activity it considers abnormal, often after a vertical rally that retail investors chased.

## Practical tips - Check the ASM/GSM list on NSE and BSE before trading a sharply moving small- or mid-cap; the lists are updated regularly. - Expect your broker to block intraday leverage and demand full margin on ASM names. - Use it as a screening signal: a stock entering long-term ASM stage III or IV after a parabolic move is exactly where many retail traders get trapped at the top.