SEBI Chair is expected to release a discussion paper today or tomorrow outlining measures to address derivatives trading.
SEBI will soon require brokers to display an additional six risk parameters to highlight high valuations.
The SEBI Chair will mandate that large brokers offer the secondary market ASBA (Application Supported by Blocked Amount) to investors.
According to the SEBI Chair, the increase in options trading volumes, which was previously a minor issue of investor protection, has now escalated into a broader, macro-level concern.
SEBI consultation paper on Futures and Options (F&O):
SEBI has released a consultation paper proposing measures to enhance investor protection in derivative markets:
Introduction of upfront payment for options premiums.
Increased margins required on the expiry day and the day before.
Members must collect option premiums upfront.
Proposal to limit F&O products to weekly expirations.
Monitoring of position limits for index derivatives.
SEBI proposes to gradually raise the minimum contract size for index derivatives. Initially, the minimum value of a derivatives contract will be set between ₹15 lakh and ₹20 lakh.
Six months after the initial phase, the minimum value of a derivatives contract will be adjusted to fall within the range of ₹20 lakh to ₹30 lakh.
Weekly options contracts are to be introduced based on a single benchmark index for each exchange.
At the time of introduction, no more than 50 strike prices will be available for an index derivatives contract.SEBI Chairperson stated that households lost ₹60,000 crore in the Futures and Options (F&O) segment in 2023, highlighting it as a significant macroeconomic issue.
SEBI Chairperson stated that households lost ₹60,000 crore in the Futures and Options (F&O) segment in 2023, highlighting it as a significant macroeconomic issue.
The Securities and Exchange Board of India (SEBI) has flagged 8,890 instances of unlawful or misleading content on social media related to the stock market.
SEBI has officially notified major social media platforms and apps, including Facebook, Instagram, Telegram, and YouTube, instructing them to take legal action against the accounts responsible for disseminating false claims.
As of July 17, 2024, SEBI has reported these 8,890 instances of misleading content to the concerned social media platform providers for appropriate legal measures.
SEBI has been actively addressing the spread of illegal stock advice and misleading content propagated by so-called financial influencers (finfluencers) over the past year.
The misleading content includes false promises of guaranteed returns, use of technical jargon to confuse investors, and deceptive testimonials in social media posts and ads.
Retail investor participation in the stock market has risen significantly, with the total number of Demat accounts reaching 15.1 crore as of March 2024, according to Motilal Oswal Financial Services.
Foreign portfolio investors (FPIs) with connections to China are about to face increased scrutiny from the Securities and Exchange Board of India (SEBI).
On July 30, Sebi released a consultation paper proposing to categorize FPIs into two groups: those with majority ownership from Land Bordering Countries (LBCs) and those with more than 50 percent ownership from non-LBCs.
This proposal will lead to closer monitoring of investors from China and Hong Kong, who often use structures in Singapore and Mauritius to invest in India through the FPI route.
Many prominent global investment managers have set up FPI vehicles in Singapore or Mauritius for Chinese investors to access the Indian market.
Since these funds are routed through neutral jurisdictions like Singapore, they can obscure the Chinese origins of the investments, according to FPI experts.
Sebi has also suggested changes to how custodians and depositories handle FPI compliance. Instead of relying solely on declarations from the funds about their beneficial owners, Sebi now wants depository participants to verify and confirm the accuracy of these filings regarding China links.
Stay informed with our financial updates, stocks, bonds, commodities. Get global & political insights. Follow us & enable notifications for the latest updates.
