SEBI Bans Jane Street:
US-based Jane Street, a prominent proprietary trading firm, has been banned by Securities and Exchange Board of India (SEBI) for engaging in manipulative trading practices that disrupted market integrity and resulted in massive illegal profits. Manipulative Trading: Jane Street executed trades in the derivatives (futures) segment not to profit from market trends, but to manipulate prices. They used a “marking the close” strategy, placing large buy orders to inflate prices, then selling them later to maximize gains, employing a push-pull tactic. This intra-day manipulation misled small investors and created artificial volatility in the market. Jane Street used its Indian arm, JSI Investments Pvt Ltd, to bypass local regulations because foreign portfolio investors (FPIs) are restricted from engaging in certain cash market activities, such as intraday trading (purchasing and selling securities listed in a stock exchange on the same day).
