SEBI's new move to cut retailers participation in F&O!

The above shows that SEBI is not authoritative and they would consider views of all the participants .Exchanges want the timing to be extended and brokers do not want it ....but SEBI wants Exchanges to engage with brokers and come to some consensus.

In applying networth/ Income critaria also SEBI is not likely to take very harsh view and cause damage to the market....they will try to strike a balance between financial worth and the leverage which a person that the market liquidity does not get killed.


Tejas Khoday

Co-Founder & CEO, FYERS
Extending-trading-hours is giving a headache to SEBI. Maybe only Index trading will be allowed in the first phase.
Maybe, SEBI want to bring more regulation to cut the retailers participation in F&O before the start of extending trading hours, hence want to delay it now!

SEBI wants exchanges to consider brokers’ views before extending trading hours
NSE and BSE had submitted a plan to extended trading hours till midnight from October 1. On May 4, SEBI had agreed to increase timings for equity derivatives trading to 11.55 pm.
It is really sad that most brokers in India are more concerned about sleeping early at night and reducing overheads by a few people's salaries rather than catering to the real spirit of the markets. To give you a perspective, in a recent broker meeting hosted by NSE, the discussion was primarily about the use of technology to develop the capital markets. NSE was very bullish on its technological upgrades and was communicating that to a crowd full of representatives of their Trading Members. The tone was very positive & leaning towards Algorithmic trading, APIs, and whatnot.

When the official of NSE asked the audience if anyone had questions about adopting technology and upgrading their platforms, one of the brokers stood up and asked them this - "What is the benefit of extending trading hours till midnight if it will increase our cost, sir? What is the solution to this!?" And many shook their heads in agreement. You should've seen his reaction. Of course, the younger breed had an annoyed look on their faces too but majority wins.

SEBI is doing the right thing by consulting the brokers IMO because they are ultimately the active stakeholders who make things happen. What's sad is that most of these brokers don't want to evolve and want to stop the entire system from evolving along with them. That's the biggest disadvantage! The exchanges want to extend trading hours because it is directly proportional to the trading volumes but the brokers who have an advisory model to generate volumes want to get together and stop this transition.
Hello everyone. I am Avi Garg and I founded ARTI which stands for ASSOCIATION OF RETAIL TRADERS OF India. Our objective is to fight against SEBI because we all know SEBI is evil and their rules are regressive. I have created a petition that I would like everyone to sign -

Sign this petition and get it to as many people as possible. This petition shows our support and I'd like to present it in court when ARTI does go to court.

Yes we do plan on registering ourselves and going to court against SEBI but that's for another post.

Meanwhile, you can sign this petition and forward it to as many people as possible. Also, there 's a link below in the petition that would allow you to join our group.

Apart from that, those who are interested in joining our group can personally message or comment below.

To the moderators, I know promoting links or contacts are prohibited. It's common. That's why I am not doing that. Only allowing people who are interested to message and comment.

Have a good day!
A recent letter to SEBI by ANMI suggested that people with 25 Lacs plus be classified at HNI and below that as retail.
You have a source?
Submission of important documentation as per new SEBI guide lines
  1. Copy of the Latest ITR acknowledgement with total value of annual income greater than Rs. 1.20 Lakhs clearly specified
  2. Copy of Latest annual account statement with annual income greater than 1.20 Lakhs
  3. Copy of Latest document of Form 16 with total value of annual salary greater than Rs. 1.20 Lakhs
  4. Latest Net-worth certificate issued by any practicing Chartered Accountant with value of net-worth greater than Rs. 1.20 Lakhs
  5. Latest salary slip with value of monthly salary greater than Rs.10,000/- per month
  6. Bank Statement for the last 6 months
  7. Depository Account Holding statement

The bank statement should be such that it should commensurate with the positions (15% of the total exposure taken by the client) in the derivative segment.

As per the new norm; All customers are required to renew this mandate on a yearly basis.
What if I do not have a job but I am a self employed person? In that case there would be no Form 16 requiremnt na?
Options trading will be less attractive with comparatively less return.
Options sellers will demand more premium to compensate for the margin hike.
IV will increase. IV will increase suddenly during momentums and drop quickly too.
Options buyers will face more difficulty.
That was one of the goals for SEBI, to make option market unattractive as much as possible. With the long night hour options is going to lose momentum also. But due to less volumes. We can see the sudden increase of volatility spikes.. more frequently in night sessions.

We have to wait for the exact effect. According to report previously premium was increased automatically (by the demand from option writers) after margin hike.

Options buyers must be ready to pay for higher premium and earn less. Options will also move slower due to increased trading hours - due to add on night session.

By, increasing margin heavily SEBI had done enough. May not be so strict now on net-worth on 18th Sept meeting. IMO.
@headstrong007, is this analysis valid for index option buyers also? Or just for stock option buyers in your opinion?

I hope for 2 things to happen now:

1.) That the trading hours remain as they are - i.e., till 3.30 pm or at the most stretch till 5.30 pm - just like a normal job day, which is fine by me.

2.) That they do not put any sanctions based on net worth criteria.
If as a self employed person you don’t have form 16 but all other critaria are very easy to fulfill.

Thanks! Yes I think the others are pretty straight forward to fulfill.

Zerodha – Open Paperless Account

Open online account with Zerodha. Free delivery trading and Max Rs 20 for Intraday, F&O, Currency and Commodity Trading. Intraday High leverage with MIS, CO and BO.

Are you a day trader?