How auction affects the Portfolio and Profit & Loss?

How auction affects the Portfolio and Profit & Loss?

Impact on Profit & Loss (P&L):

Price Volatility:
Auction Price: The price determined during an auction can be significantly different from the market price, impacting your P&L. If the auction price is higher or lower than expected, it can lead to unexpected gains or losses.

Penalty Charges:
Seller Default: If you fail to deliver shares sold, penalties may apply, directly impacting your P&L. These penalties can include additional costs or fees imposed by the exchange.

Delayed Realization of Gains:
Timing of Funds: Funds from sold shares in an auction may be credited later than in normal market transactions, delaying the realisation of gains and affecting cash flow.

 



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