New Delhi, April 30 -- The Securities and Exchange Board of India (Sebi) has turned the spotlight on a sophisticated market manipulation technique known as "spoofing" through a recent interim order against Patel Wealth Advisors Pvt. Ltd. (PWAPL), a registered stockbroker. The order details PWAPL's alleged use of high-frequency algorithmic strategies over three years to distort prices in both the equity and derivatives markets.

Mint delves into the intricacies of spoofing, its detrimental impact on market integrity, and the broader implications of Sebi's action for brokers, traders and algorithmic trading operators.

Spoofing is a deceptive tactic through which traders strategically place substantial buy or sell orders at prices that diff...