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Exclusive | SEBI may lower margin requirements for hedged trades in F&O segment

The SEBI-appointed Risk Management Review Committee met on October 16 and agreed to most recommendations of the sub-working group. This group had proposed lower margins for hedged positions and status quo on unhedged derivative positions

October 30, 2019 / 05:37 PM IST

Capital and commodities markets regulator Securities and Exchange Board of India (SEBI) plans to reduce margin requirements on certain trades done in the equity and currency derivative segments, sources told Moneycontrol.

The idea behind the reduction is to bring margins on derivative trades in India on par with those levied by global exchanges.

A recent study by EY showed that margins on derivative trades in India are up to 500 times higher compared to global exchanges.

The study had compared margins levied by Indian exchanges and those by bourses like Chicago Mercantile group, Osaka Securities Exchange, New York Stock Exchange, Singapore Stock Exchange, Euronext, Australian Stock Exchange and Hong Kong Stock Exchange.