SEBI plans stricter eligibility criteria for inclusion of stocks in F&O segment: Report

The Securities and Exchange Board of India (Sebi) is planning to introduce new rules to tighten the eligibility criteria for the inclusion of stocks into the equity derivatives segment, the Economic Times reported on August 12, citing sources in the know of the development.

The proposed stricter rules could restrict the entry of various thinly-traded stocks into futures and options.

The capital market regulator may propose that for being eligible for inclusion or to remain in the derivative segment, the average daily delivery value of a share should be at least Rs 10 crore to Rs 20 crore in the previous six months on a rolling basis, the report noted.

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SEBI is also likely to double the market-wide position limit from the existing Rs 500 crore to Rs 1,000 crore on a rolling basis, for the inclusion of stock in the F&O segment.

Newly-listed stocks would be eligible for entry into the F&O segment only after six months of listing, according to the proposed criteria.

Sebi may also include a clause that the stock should be traded by 15% of the registered brokers or at least 200 brokers, whichever is lesser, to be eligible for the F&O segment.

The proposal was reportedly discussed in a recent Sebi-appointed Secondary Market Advisory Committee (SMAC) meeting.

Moneycontrol could not independently verify the report.