00:00Sebi has proposed new rules to reduce the risk of traders and investors.
00:07Sebi has proposed to reduce the position limit of equity stock derivatives and to tighten the rules of index derivatives.
00:15Prior to this, in October 2023, Sebi had tightened the rules of derivatives trading and made trading expensive to protect retail investors.
00:25The special thing is that the new proposals have come at a time when there is a growing concern in the market that the rise and fall in the futures and options market is affecting the entire share market.
00:35Since reaching a record high in September 2024, there has been a decline in the share market.
00:41So let's know about the rules once.
00:44The first is the calculation change of open interest.
00:47Until now, the calculation of open interest was done from the total value of the shares, which was called the national value.
00:53Now Sebi has proposed that it should be calculated on the basis of the future equivalent.
00:58This will make it more accurate to analyze the risk in the market and there will be no restriction on the shares in the wrong way.
01:05The second is the market wide position limit, i.e. the reduction in MWPL.
01:10The MWPL of any share determines how much can be invested in it at a time.
01:17At present, this limit is 20% of the market capitalization of the share, which can be reduced to 15% or 60X on average, whatever is less than the daily delivery value.
01:28This will reduce the rise and fall in the market and will help in stopping the fall.
01:32The third is the new rules of trading during the ban period.
01:35When a share exceeds 95% of its MWPL, derivative trading is stopped on it.
01:42According to the new rules, investors will be able to trade only those who have less open interest.
01:47This will maintain liquidity in the market and investors can be saved from loss.
01:53The fourth rule is intraday risk monitoring.
01:55Now MWPL is monitored once a day.
01:58Sebi has proposed that it should be monitored 4 times a day.
02:02This will immediately find out any problem in the market and the market will remain stable.
02:08The fifth rule is the change in the exposure limit for mutual funds and AIF.
02:12According to the new rules, all options will be measured by the Future Equivalent method.
02:17This will improve risk management and increase transparency for mutual funds and AIF investors.
02:23In short, these new rules of Sebi will help the market to become stronger and more sustainable.
02:28Sebi has asked for suggestions on these proposals till March 17, 2025.
02:33So what do you have to say about these new proposed rules?
02:36Share your views in the comments.
02:38If you are watching the video on Facebook, then like the Facebook page.
02:41And if you are watching on YouTube, then don't forget to subscribe to GoodReturns' YouTube channel.
Comments