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Fastest-finger-first on Bond Street: Large investors alert Sebi

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While the e-bidding platform has removed the opaqueness that plagued the private placement of debts, market participants think it works better for issues where there is price or yield bidding.

Synopsis

A few of these high-speed traders who are outwitting the traditional debt investors, like bond houses, asset managers, insurers and retirement funds, are suspected to be using specialised software to grab securities in what’s largely a ‘fastest-finger-first’ contest. In a volatile market when prices improve, they sell down the cornered papers almost immediately to make quick money.

Mumbai: Large bond investors have told the Securities and Exchange Board of India (Sebi) that some of the players are gaming the electronic bidding system to snatch deals within less than a second of the opening of the issue.

A few of these high-speed traders who are outwitting the traditional debt investors, like bond houses, asset managers, insurers and retirement funds, are suspected to be using specialised software to grab securities in

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