The 11th JP Morgan India Conference saw Chairman Tuhin Kanta Pandey announce SEBI’s scrutiny of margin requirements for longer‑term derivative contracts—an effort aimed at easing the high losses gripe among individual traders.
Pandey said the regulator has already taken various measures for the F&O market and is now looking to improve its functioning further. He added that the 2024 consultation paper for expiry‑day settlement, issued on September 12, will test the delinking of derivatives settlement prices from the cash‑market closing price.
The paper also proposes discontinuing live indicative index values during the Closing Auction Session and tightening the 1% band on orders placed beyond that range. "Having successfully established the Closing Auction Session as an important market structure reform, we intend to address concerns in respect of settlement price for derivatives on expiry days and other related issues," Pandey said.
Meanwhile, Reserve Bank of India Deputy Governor Poonam Gupta highlighted that the bond market has performed well, but equity markets lag, underscoring the need for a larger pool of capital. She noted that banks and capital markets must complement each other to meet India’s growing financing requirements.
Market participants are now keenly watching the final decision, which is expected by the end of Q4. Tighter margin rules could compress spreads and impact liquidity, making the forthcoming guidance a focal point for traders and institutional investors alike.