SEBI has received over 800 comments on its consultation paper regarding F&O market regulations, highlighting the need for systemic improvements, he added. Pandey emphasized that the regulator does not intend to limit the F&O market to just basic index options but aims to establish a well-defined risk metric for derivatives trading.
“We must decide not necessarily based on what was proposed in the paper but on what is the most practical,” Pandey said.
This development comes amid growing concerns about the speculative nature of F&O trading and the need for stronger risk management frameworks.
In late March, the SEBI chief mentioned that the regulator cannot restrict retail investors in derivatives based on specific thresholds, describing it as a “sledgehammer” approach.
“Any regulator in any sector needs to balance these two sides. F&O itself is a complex market. We cannot have a sledgehammer or a blunt approach; we need a surgeon’s knife. We need to know exactly how; otherwise, innovations will be lost,” Pandey said at a media company event, stressing the importance of nuanced, data-driven regulations to avoid stifling innovation.
Pandey’s comments come months after SEBI introduced measures to prevent excess speculation in derivatives on October 1 last year.
(Edited by : Ajay Vaishnav)
