New York-based world proprietary buying and selling agency Jane Avenue has strongly criticised India’s market regulator Sebi over its latest enforcement motion, calling the accusations “extraordinarily inflammatory” and stating it’s “past upset” by the order.
The agency, which is among the many largest gamers on Wall Avenue, stated in a mail to its workers that it’s getting ready a proper response to the Securities and Change Board of India’s (Sebi) determination, which features a ban on the agency’s market participation and an order to impound Rs 4,843 crore in what the regulator described as “illegal features”.
Jane Avenue rejected the market watchdog’s cost that it was concerned in “an intentional, effectively deliberate, and sinister scheme” to control Indian markets by way of its derivatives trades, particularly in Nifty Index futures. The agency asserted it will contest the order by way of acceptable authorized channels.
In a memo despatched to its roughly 3,000 workers on Sunday and reported by the Monetary Occasions newspaper, Jane Avenue stated, “it’s deeply upsetting to see the agency mischaracterised this manner.”
“We take pleasure within the function we serve in markets around the globe, and it’s painful to have our agency’s popularity tarnished by a report primarily based on so many misguided or unsupported assertions,” the memo stated.
Jane Avenue is but to reply to a mail in regards to the Sebi allegations despatched by The Indian Specific.
Sebi costs ‘removed from actuality’: Jane Avenue
Final week, the market regulator granted Jane Avenue 21 days to file an objection to its order and request a listening to. Jane Avenue, one of the outstanding and profitable proprietary buying and selling companies to emerge up to now twenty years, has grown into a serious pressure throughout world monetary markets.
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In its inner memo, Jane Avenue criticised Sebi for counting on “a metric for market impression and buying and selling aggressiveness which appears disconnected from precise market dynamics.” The agency argued that its buying and selling exercise on January 17, 2024 — one of many days singled out in Sebi’s report — mirrored routine “primary arbitrage buying and selling,” a broadly accepted technique within the business.
Jane Avenue has sharply contested Sebi’s declare that it disregarded considerations raised by the Nationwide Inventory Change (NSE), an allegation the regulator used to justify its sudden and unprecedented ban on the agency’s buying and selling operations in India. Within the inner memo, Jane Avenue described the cost as “particularly removed from actuality,” stating that it had promptly halted its buying and selling exercise on the time to higher perceive the alternate’s considerations. The agency added that it subsequently adjusted its methods to align with the NSE’s said preferences.
“As soon as once more, we left this course of feeling that we had reached an understanding of the considerations and mirrored them in modifications to our buying and selling behaviour,” the memo stated. “Since February, we’ve made ongoing efforts to speak with Sebi and have been persistently rebuffed.”
Why is Jane Avenue so in style?
In keeping with the FT report, the US agency almost doubled its internet buying and selling revenues to $20.5 billion final yr, outpacing a number of of Wall Avenue’s greatest banks. Within the first quarter of 2025, Jane Avenue notched up internet buying and selling revenues of $7.2 billion, greater than Morgan Stanley.
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“Sebi’s investigation was triggered by revelations from a lawsuit launched by Jane Avenue final yr towards Millennium Administration and two former merchants that had moved to the hedge fund. Jane Avenue’s grievance alleged that the merchants had stolen a vastly worthwhile buying and selling technique, which was later revealed to revolve round Indian choices buying and selling,” FT report stated.
Jane Avenue executing ‘marking the shut’ technique: Sebi
In keeping with the regulator’s findings, Jane Avenue’s trades, notably in Nifty index futures, confirmed a transparent sample. The agency wasn’t buying and selling passively or reacting to the market — it was nudging costs upward, persistently putting orders at or above the final traded value (LTP). This sample intensified within the ultimate hours of buying and selling, a important window that usually shapes the day’s closing value. Sebi described it as a “non-neutral buying and selling behaviour”, a strategic try and affect costs fairly than merely have interaction with the market. And the tactic wasn’t random; it adopted a widely known play within the buying and selling world: “marking the shut.”
Jane Avenue, regulators say, was executing what’s generally known as an prolonged ‘marking the shut’ technique — putting giant and aggressive purchase or promote orders close to the tip of the buying and selling session, with the intention of artificially transferring the closing value of a inventory or index. The closing value is important, particularly on derivatives expiry days, because it determines the settlement worth for futures and choices contracts.