SEBI Alters Exercise Mechanism Of Commodity Futures Options
Securities and Exchange Board of India (SEBI)Â on Monday made changes in the "exercise mechanism" of option contracts on commodity futures.
The markets regulator said that the changes were effected on the basis of feedback received from stock exchanges as well as recommendations given by the Commodity Derivatives Advisory Committee of SEBI.
The regulator in a circular said that the prescribed mechanism will be adopted by exchanges for exercise of the options contracts on expiry.
Under the mechanism, it said that All In the Money (ITM) option contracts will be exercised automatically, unless 'contrary instruction' has been given by long position holders of such contracts for not doing so.
Besides, All Out of the Money (OTM) option contracts shall expire worthless, it added.
All exercised contracts within an option series shall be assigned to short positions in that series in a fair and non-preferential manner, the regulator said.
The new framework will be effective from the date of new series of commodity derivatives launched on or after February 1, 2022, SEBI said.
In June 2017, the regulator permitted commodity derivatives exchanges to introduce trading in options on commodity futures and stipulated guidelines with regard to the product design and risk management framework to be adopted for trading in options on commodity futures.
-
Talking Points This Week: Tech Nerves, FII Buying, And A Faraway Banking Shock
The global markets are not shining this Diwali. The exception in the large markets is, India.
-
Midterm Rally Lasted A Day. The Hard Reality Of A Divided US May Last Two Years | Opinion
Between a contested AI boom, a debt ceiling that arrives in 2027 and a president with every incentive to act alone, the next two years may prove more volatile than the first day's rally suggests.
-
Blue Wave Will Derail the AI Trade but Won't Dismantle the AI Era | Unhedged Position
The Democrats' sweep of the US Congress will see politics collide with economic forces both over the long and short term.
-
It's Time To Take The GST Council's Bet On Trust Global
Payment records can prove India's services exports, and clear, proportionate rules can bring foreign digital sellers into the tax net.
-
Opinion | India at 38: From Innovation Overperformer to Innovation Powerhouse
India now has 453 VC-backed deep science startups, 18 of them late-stage, after 117 percent growth since 2020. Laurus Labs, at USD 9.3 billion, is the most valuable deep science company in any middle-income economy outside China.
-
Navigating Energy Crossroads: S Jaishankar's Call For Diversified Supply Chains At G20 Ministerial Meeting
As geopolitical fault lines continue to test maritime trade routes and commodity flows, Jaishankar's message remains pertinent: true economic resilience requires open markets, protected transit lines, and a genuine commitment to multilateral cooperation rather than coercion.
-
Indians Are Travelling, But Not Every Journey Is A Holiday | The Week In Whys
Pilgrims, patients and working women are the real travellers, and the system hasn't quite caught up with them.
-
Getting To Work Costs Women More | The Reason Why
It is not just about women paying more than men. It is about women paying much more in cities than in villages.
-
AI Bias In Investing Cannot Be Eliminated, But It Can Be Governed
Framing is a particularly important example as identical financial information presented in terms of gains rather than losses can lead an LLM to reach a different assessment.
