Mraket regulator SEBI has elevated the general place restrict on the buying and selling member degree throughout shopper and proprietary trades in index futures and choices to ₹7,500 crore, or 15 per cent of whole open curiosity (OI) out there.
Till now, the general place restrict on the buying and selling member degree (proprietary and shopper) was set at ₹500 crore.
“Based mostly on the suggestions obtained from market members, the deliberations held within the Secondary Market Advisory Committee (SMAC) and additional inside discussions, the place limits for TMs, cumulatively for shopper and proprietary trades, in index Futures and Choices contracts could also be set at increased of ₹7,500 crore or 15 per cent of the overall OI out there. As per the extant follow, the place limits will likely be relevant for index futures and index choices individually,” SEBI mentioned in a round.
Noting that the open curiosity of each the members and the market is dynamic and altering all through the day, Sebi mentioned that the positions of market members within the fairness derivatives phase will now be monitored primarily based on whole open curiosity of the market on the finish of earlier day’s commerce.
“In case of a drop in market OI in comparison with the day before today’s market OI, market members might breach the required place limits even when their positions have remained unchanged all through the day. For such instances of passive breaches, market members wouldn’t be penalised and never be required to unwind their positions,” the regulator mentioned.
Brokers had raised issues over the brand new guidelines governing F&O buying and selling. Monitoring of place limits intra-day versus end-of-day might influence proprietary buying and selling desks, high-frequency merchants and international portfolio buyers (FPIs).
At present, place limits are specified by SEBI on the shopper degree for index derivatives contracts. Many gamers breach this restrict intraday however get again to allowed limits earlier than markets shut. The brand new limits set by SEBI will enable extra head room for merchants.
