SEBI Options Trading Crackdown Triggers Rs 1.75 Lakh Crore Market Wipeout

Impact on Exchanges

• BSE: Shares of the Bombay Stock Exchange crashed by 29% from their peak, erasing Rs 35,000 crore in market value.
• NSE: The National Stock Exchange, which is not listed publicly, saw its unlisted shares fall by 22%, wiping out Rs 1.4 lakh crore in value.

Brokerage Losses

Discount broker Angel One, which depends heavily on Futures and Options (F&O) trading revenue, plunged 37% from its peak. This shows how deeply the new regulations have impacted trading-linked businesses.

Why Did SEBI Act?

SEBI started its crackdown in October 2024 after data revealed that 91% of individual traders lost Rs 1.06 lakh crore in equity derivatives. On average, each trader lost about Rs 1.1 lakh.

NSE dominates the derivatives market with a 78% share in options premium turnover and over 99% share in futures trading.

Changes in Market Dynamics

Recently, BSE and NSE swapped their derivatives expiry days. This move increased BSE’s share in the market. In the first week of September, BSE’s options premium turnover surged by 19%, and its market share jumped to 28.2%.

New SEBI Rules

SEBI has introduced multiple restrictions to make derivatives trading safer:

• Reduction in the number of weekly expiries
• Increase in lot sizes
• 2% hike in extreme loss margins

What Experts Say

Market experts believe the uncertainty will continue until SEBI gives more clarity on its regulatory framework. However, some analysts think that the current dip has created investment opportunities in select exchange and brokerage stocks.

Conclusion

SEBI’s strong push for investor protection has caused massive short-term losses in stock exchange and brokerage shares. While the market is facing a wipeout of Rs 1.75 lakh crore, the long-term impact will depend on how traders, investors, and institutions adapt to the new rules.