{"id":7865,"date":"2025-07-15T13:25:56","date_gmt":"2025-07-15T13:25:56","guid":{"rendered":"https:\/\/lemonn.co.in\/blog\/?post_type=glossary&#038;p=7865"},"modified":"2025-07-15T13:25:58","modified_gmt":"2025-07-15T13:25:58","slug":"periodic-call-auction","status":"publish","type":"glossary","link":"https:\/\/lemonn.co.in\/blog\/glossary\/periodic-call-auction\/","title":{"rendered":"Periodic Call Auction"},"content":{"rendered":"<p>A <strong><a class=\"glossaryLink\" href=\"https:\/\/lemonn.co.in\/blog\/glossary\/periodic-call-auction\/\" data-gt-translate-attributes='[{\"attribute\":\"data-cmtooltip\", \"format\":\"html\"}]' tabindex=\"0\" role=\"link\">Periodic Call Auction<\/a><\/strong> is a special stock <a class=\"glossaryLink\"  href=\"https:\/\/lemonn.co.in\/blog\/glossary\/trading\/\"  data-gt-translate-attributes='[{\"attribute\":\"data-cmtooltip\", \"format\":\"html\"}]'  tabindex='0' role='link'>trading<\/a> method used to <strong>buy or sell illiquid <a class=\"glossaryLink\"  href=\"https:\/\/lemonn.co.in\/blog\/glossary\/shares\/\"  data-gt-translate-attributes='[{\"attribute\":\"data-cmtooltip\", \"format\":\"html\"}]'  tabindex='0' role='link'>shares<\/a><\/strong>&#x2014;those that <strong>don&#x2019;t trade often<\/strong>. Instead of matching trades instantly like in normal trading, these shares are traded at set times in <strong>batch sessions<\/strong>.<\/p>\n\n\n\n<h2 id=\"why-it-exists\" class=\"wp-block-heading\">Why It Exists<\/h2>\n\n\n\n<p>Some <a class=\"glossaryLink\"  href=\"https:\/\/lemonn.co.in\/blog\/glossary\/stocks\/\"  data-gt-translate-attributes='[{\"attribute\":\"data-cmtooltip\", \"format\":\"html\"}]'  tabindex='0' role='link'>stocks<\/a> don&rsquo;t have enough buyers or sellers. These are called <strong>illiquid shares<\/strong>.<br>Without enough trades, prices can be manipulated easily.<\/p>\n\n\n\n<p>The <strong>Periodic Call Auction<\/strong> helps by:<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>Reducing price manipulation<\/li>\n\n\n\n<li>Ensuring fair price discovery<\/li>\n\n\n\n<li>Grouping all orders together at one time<\/li>\n<\/ul>\n\n\n\n<h2 id=\"how-it-works-step-by-step\" class=\"wp-block-heading\">How It Works (Step-by-Step)<\/h2>\n\n\n\n<ol class=\"wp-block-list\">\n<li><strong>Time Slots<\/strong>: Trading happens in a fixed time window (usually every 60 minutes).<\/li>\n\n\n\n<li><strong>Order Collection<\/strong>: All buy and sell orders are collected together.<\/li>\n\n\n\n<li><strong>Price Matching<\/strong>: The <a class=\"glossaryLink\" href=\"https:\/\/lemonn.co.in\/blog\/glossary\/stock-exchange\/\" data-gt-translate-attributes='[{\"attribute\":\"data-cmtooltip\", \"format\":\"html\"}]' tabindex=\"0\" role=\"link\">stock exchange<\/a> finds a single price that matches most buy and sell orders.<\/li>\n\n\n\n<li><strong>Trade Execution<\/strong>: All trades are executed at that one price.<\/li>\n\n\n\n<li><strong>Repeat<\/strong>: This process is repeated at fixed intervals throughout the day.<\/li>\n<\/ol>\n\n\n\n<h2 id=\"real-life-example\" class=\"wp-block-heading\">Real-Life Example<\/h2>\n\n\n\n<ul class=\"wp-block-list\">\n<li>Let&#x2019;s say Company XYZ is illiquid.<\/li>\n\n\n\n<li>Between 10&#x2013;11 AM, 100 shares are bid at &#x20B9;10 and 80 shares are offered at &#x20B9;9.90.<\/li>\n\n\n\n<li>Exchange sets a common auction price&#x2014;say &#x20B9;9.95&#x2014;where most orders match.<\/li>\n\n\n\n<li>Trades are executed at &#x20B9;9.95 for all matched buyers\/sellers.<\/li>\n<\/ul>\n\n\n\n<h2 id=\"which-shares-use-this-system\" class=\"wp-block-heading\">Which Shares Use This System?<\/h2>\n\n\n\n<ul class=\"wp-block-list\">\n<li>Shares marked as <strong>&#x201C;illiquid&#x201D;<\/strong> by <a class=\"glossaryLink\"  href=\"https:\/\/lemonn.co.in\/blog\/glossary\/sebi\/\"  data-gt-translate-attributes='[{\"attribute\":\"data-cmtooltip\", \"format\":\"html\"}]'  tabindex='0' role='link'>SEBI<\/a> or exchanges.<\/li>\n\n\n\n<li>Usually those:\n<ul class=\"wp-block-list\">\n<li>With very <strong>low daily trades<\/strong><\/li>\n\n\n\n<li>Traded by very <strong>few investors<\/strong><\/li>\n\n\n\n<li>With very <strong>high price swings<\/strong><\/li>\n<\/ul>\n<\/li>\n<\/ul>\n\n\n\n<h2 id=\"benefits-of-periodic-call-auction\" class=\"wp-block-heading\">Benefits of Periodic Call Auction<\/h2>\n\n\n\n<figure class=\"wp-block-table\"><table><thead><tr><th>Feature<\/th><th>Benefit<\/th><\/tr><\/thead><tbody><tr><td>Order bunching<\/td><td>Better price matching<\/td><\/tr><tr><td>Fairer trading<\/td><td>Reduces unfair price jumps<\/td><\/tr><tr><td>Prevents manipulation<\/td><td>Safer for small investors<\/td><\/tr><tr><td>Price stability<\/td><td>No wild intraday price swings<\/td><\/tr><\/tbody><\/table><\/figure>\n\n\n\n<h2 id=\"points-to-remember\" class=\"wp-block-heading\">Points to Remember<\/h2>\n\n\n\n<ul class=\"wp-block-list\">\n<li><strong>You can&#x2019;t trade illiquid shares freely during the day<\/strong>&#x2014;only in the auction windows.<\/li>\n\n\n\n<li><strong>You may not find a match for your order every time<\/strong>.<\/li>\n\n\n\n<li>Stocks can <strong>move in or out of this system<\/strong> based on <a class=\"glossaryLink\" href=\"https:\/\/lemonn.co.in\/blog\/glossary\/liquidity\/\" data-gt-translate-attributes='[{\"attribute\":\"data-cmtooltip\", \"format\":\"html\"}]' tabindex=\"0\" role=\"link\">liquidity<\/a> levels.<\/li>\n<\/ul>\n\n\n\n<h2 id=\"why-it-s-important-for-you\" class=\"wp-block-heading\">Why It&#x2019;s Important for You<\/h2>\n\n\n\n<p>If you hold or want to invest in low-<a class=\"glossaryLink\"  href=\"https:\/\/lemonn.co.in\/blog\/glossary\/volume\/\"  data-gt-translate-attributes='[{\"attribute\":\"data-cmtooltip\", \"format\":\"html\"}]'  tabindex='0' role='link'>volume<\/a> or <a class=\"glossaryLink\" href=\"https:\/\/lemonn.co.in\/blog\/glossary\/penny-stocks\/\" data-gt-translate-attributes='[{\"attribute\":\"data-cmtooltip\", \"format\":\"html\"}]' tabindex=\"0\" role=\"link\">penny stocks<\/a>, your trades may happen through <strong><a class=\"glossaryLink\" href=\"https:\/\/lemonn.co.in\/blog\/glossary\/periodic-call-auctions\/\" data-gt-translate-attributes='[{\"attribute\":\"data-cmtooltip\", \"format\":\"html\"}]' tabindex=\"0\" role=\"link\">Periodic Call Auctions<\/a><\/strong>.<\/p>\n\n\n\n<p>It&#x2019;s crucial to:<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>Be patient<\/li>\n\n\n\n<li>Understand the auction timings<\/li>\n\n\n\n<li>Use <a class=\"glossaryLink\" href=\"https:\/\/lemonn.co.in\/blog\/glossary\/limit-order\/\" data-gt-translate-attributes='[{\"attribute\":\"data-cmtooltip\", \"format\":\"html\"}]' tabindex=\"0\" role=\"link\">limit order<\/a>s, not <a class=\"glossaryLink\" href=\"https:\/\/lemonn.co.in\/blog\/glossary\/market-order\/\" data-gt-translate-attributes='[{\"attribute\":\"data-cmtooltip\", \"format\":\"html\"}]' tabindex=\"0\" role=\"link\">market order<\/a>s<\/li>\n<\/ul>\n","protected":false},"excerpt":{"rendered":"<p>A Periodic Call Auction is a special stock trading method used to buy or sell illiquid shares&#x2014;those that don&#x2019;t trade often. Instead of matching trades instantly like in normal trading, these shares are traded at set times in batch sessions. Why It Exists Some stocks don&#x2019;t have enough buyers or sellers. These are called illiquid [&#x2026;]<\/p>\n","protected":false},"author":9,"featured_media":0,"menu_order":0,"template":"","meta":{"footnotes":""},"class_list":["post-7865","glossary","type-glossary","status-publish","hentry"],"blocksy_meta":[],"_links":{"self":[{"href":"https:\/\/lemonn.co.in\/blog\/wp-json\/wp\/v2\/glossary\/7865","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/lemonn.co.in\/blog\/wp-json\/wp\/v2\/glossary"}],"about":[{"href":"https:\/\/lemonn.co.in\/blog\/wp-json\/wp\/v2\/types\/glossary"}],"author":[{"embeddable":true,"href":"https:\/\/lemonn.co.in\/blog\/wp-json\/wp\/v2\/users\/9"}],"version-history":[{"count":2,"href":"https:\/\/lemonn.co.in\/blog\/wp-json\/wp\/v2\/glossary\/7865\/revisions"}],"predecessor-version":[{"id":7867,"href":"https:\/\/lemonn.co.in\/blog\/wp-json\/wp\/v2\/glossary\/7865\/revisions\/7867"}],"wp:attachment":[{"href":"https:\/\/lemonn.co.in\/blog\/wp-json\/wp\/v2\/media?parent=7865"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}