No ban on weekly F&O contracts: Sebi chairman

MUMBAI: Markets regulator Sebi will not ban weekly derivatives contracts that have emerged as one of the most traded contracts in the country but will bring in changes to the futures & options (F&O) segment in a calibrated manner, Sebi chairman Tuhin Kanta Pandey reiterated his stand on the issue on Friday.Over the last few years retail investors have taken to trading weekly options contracts more than any other F&O contracts, raising concerns among regulators, policy makers and the govt that these instruments are being used more for speculation than for any productive purpose. As a result, the regulator has limited only one weekly contract per exchange.“We cannot just shut down weekly F&O expiries. Many market participants are actively using it,” Pandey said at an event in the city.The Sebi chief said that the regulator was now gathering and analysing a large amount of data on trading patterns in the F&O segment, and the same will be released in the form of a consultation before moving forward. He also said that Sebi had already implemented some measures in the derivatives sector, some of which have not yet gone into effect.Speaking about risk management and market integrity in the F&O space, Pandey said that Sebi had prescribed a range of measures “to strengthen the equity derivatives framework. These measures were taken to address the heightened market activity on expiry day and to manage the risk better, ensuring that foundation of market operations remains strong even in times of stress.”