The Securities and Change Board of India on Tuesday has launched a variety of newest measures beneath its F&O framework to strengthen the equity index derivatives market, specializing in investor security and market stability. These measures stem from options made by SEBI’s Educated Working Group on derivatives and the Secondary Market Advisory Committee.
One among many changes included the mandatory upfront assortment of alternative premiums from patrons, which might forestall undue intraday leverage. “It has been decided to mandate assortment of selections premium upfront from alternative patrons by the shopping for and promoting member or clearing member,” The markets regulator acknowledged in a spherical. This requirement will take influence from February 2025.
Furthermore, SEBI will take away calendar unfold remedy on the expiry day of contracts, aiming to minimise basis hazard on these high-volume shopping for and promoting days. This measure may even be environment friendly from February 2025.
The markets regulator’s announcement received right here after its Monday board meeting, the place it was anticipated to approve the options of the skilled working committee and Secondary Market Advisory Committee aimed towards tightening legal guidelines for retail specific particular person spinoff retailers. The F&O Framework was not included inside the Monday meeting.
SEBI in its Tuesday’s spherical had highlighted that elevated retail participation, short-tenure index selections contracts, and heightened speculative shopping for and promoting volumes on expiry days have impacted the market.
