PWG Business News: Your Gateway to Market Intelligence
PWG Business News is committed to providing real-time updates and expert-driven insights across various industries, including technology, healthcare, finance, energy, automotive, and consumer goods. We deliver carefully curated news, financial reports, and research-based updates, helping businesses and professionals stay informed and competitive in today’s dynamic business environment.
Our News section covers industry-shaping events such as market expansions, new product launches, mergers and acquisitions, policy shifts, and corporate earnings, offering a strategic advantage to decision-makers seeking actionable intelligence. By bridging industry leaders, stakeholders, and professionals with data-driven content, we empower our audience to navigate the complexities of the global market with confidence.
PWG Business News: Keeping You Ahead in the Business World
At PWG Business News, we deliver timely and credible business news, covering global market trends, economic shifts, and emerging opportunities. With comprehensive coverage spanning healthcare, technology, telecommunications, utilities, materials, chemicals, and financials, our platform provides accurate, well-researched insights that drive success for executives, investors, and industry professionals alike.
Whether you're tracking regulatory updates, innovation trends, or strategic collaborations, PWG Business News ensures you have access to high-quality, data-backed reports that enhance brand visibility, credibility, and engagement. Our mission is to keep you ahead by serving as your trusted source for impactful industry news and market intelligence.
Stay informed with PWG Business News – your gateway to the insights that shape the future of business.
Utilities
The Securities and Exchange Board of India (SEBI) has recently proposed a significant change in the way equity derivatives contracts are structured in the Indian financial market. The proposal specifically aims to limit the expiry days of all equity derivatives contracts to either Tuesday or Thursday. This move is part of a broader effort by SEBI to enhance market stability and predictability, particularly around expiry days when trading volumes and volatility tend to increase.
SEBI's decision comes in response to the rising concerns about market stability and investor protection. The current system allows multiple expiry days, which can lead to what is known as "expiry day hyperactivity." This phenomenon involves high trading volumes and volatility around expiry days, potentially jeopardizing orderliness and stability in the market. By standardizing expiry days, SEBI aims to reduce concentration risk and create a more predictable environment for investors.
SEBI's proposal is designed to increase predictability and stability in the market. By eliminating multiple expiry days, traders can better anticipate and plan for market fluctuations, which can lead to more informed investment decisions.
By spreading out expiry days and limiting them to specific days of the week, SEBI aims to reduce concentration risk. This means that trading activity and volatility are less likely to be concentrated on a single day, minimizing the potential for market disruptions.
While ensuring predictability, the proposal also allows for some flexibility in product offerings. Exchanges can differentiate their contracts by choosing whether their benchmark index options expire on a Tuesday or Thursday. This flexibility encourages innovation and can help exchanges tailor products to specific market needs.
Market participants have mixed views on SEBI's proposal. Some welcome the move as it provides more predictability and stability, while others, particularly alternative investment funds, express concerns about restricted trading strategies and potential impacts on liquidity.
Experts note that avoiding expiries on Mondays and Fridays can mitigate some of the volatility associated with these days, given their proximity to weekends. However, it is crucial for the chosen expiry days to align with market realities to ensure they do not restrict diverse trading strategies.
SEBI has invited feedback from stakeholders until April 17, 2025, which indicates an openness to refining the proposal based on market input. This approach ensures that any changes are well-considered and beneficial to a wide range of market participants.
SEBI's efforts to regulate expiry days are part of a broader strategy to enhance market stability and protect investor interests. Following concerns about hyperactivity on expiry days, SEBI has been actively working to streamline derivatives markets. The October 2024 circular was part of these efforts, aiming to curb excessive trading volumes on expiry days.
The recent proposal is a continuation of these efforts, recognizing that while predictability is important, it is equally crucial to ensure that markets remain dynamic and responsive to investor needs. By inviting public feedback and considering stakeholder inputs, SEBI demonstrates its commitment to creating a robust and stable financial environment.
As the financial landscape continues to evolve, SEBI's initiatives will likely shape the future of derivatives trading in India. The proposal to limit expiry days is a significant step in this direction, emphasizing the importance of predictability and stability while fostering innovation and flexibility in financial markets. Whether this proposal undergoes further refinement or is implemented as proposed, it is clear that SEBI's efforts will have a profound impact on how equity derivatives are traded and managed in the future.
