SEBI likely to alter derivative settlement rules
In short
SEBI is likely to change how derivatives are settled after sharp price swings on expiry days and pushback from the market. The reports say it may use the last 30 minutes’ average price for at least a year, while still keeping the closing auction for less-liquid stocks.
This matters for derivatives traders because the settlement price method affects expiry-day outcomes. The final decision and exact start date are still not confirmed.
What the reporting says
SEBI is likely to change derivative settlement rules after pushback and sharp expiry-day price swings, according to multiple publisher summaries. The reports say it may stop using the closing auction for derivatives settlement for at least a year and instead use the final 30 minutes’ volume-weighted average price, while keeping the closing auction for less-liquid cash stocks. The exact timing is not confirmed, though implementation could come by month-end.
Why it matters
SEBI is reported to be moving away from using the closing auction for derivative settlement, likely for at least a year, after sharp expiry-day swings. The publisher summaries say it may shift to the final 30 minutes’ volume-weighted average price while retaining the auction for less-liquid cash stocks. The change would affect derivatives traders and cash-market mechanics if implemented.