Expiry Trading Has Changed: What CAS Means for Traders

From August 3, 2026, the new Closing Auction Session (CAS) has changed how traders should look at the final part of the market, especially on expiry days. The confusing part is simple: for F&O stocks, normal trading now ends at 3:15 PM, while the Closing Auction Session takes place after that. F&O contracts can continue trading until 3:40 PM. For example, suppose $SBIN is trading at ₹800 at 3:15 PM. A trader may assume that ₹800 is the closing price. But during the auction, strong buying could push the official closing price to ₹810. This matters because the final closing price can impact the settlement value of certain F&O positions. Consider an expiry trade: SBI is at ₹805 around 3:15 PM and you have sold the 820 Call. It looks safely out-of-the-money. But if the CAS results in a much higher closing price, the final settlement calculation could be different from what the 3:15 PM price suggested. So, traders need to rethink the old approach of simply waiting until the last few minutes of expiry. Position management, hedging and defined-risk strategies become more important, particularly for option sellers. The key takeaway is simple: 3:15 PM is no longer the end of the price-discovery process for F&O stocks. Traders should understand CAS and avoid taking large unhedged positions based only on the 3:15 PM price.