SEBI Chair Tuhin Kanta Pandey has cautioned against rushing into fresh curbs on the derivatives segment, even as he acknowledged concerns around expiry-day “hyperactivity” and the growing influence of finfluencers on retail traders.
Speaking to NDTV Profit, Pandey said market volatility should not be simplistically attributed to futures and options (F&O) trading as a whole.
“We should not club everything as F&O volatility,” he said, urging a more nuanced assessment of activity within the derivatives space.
Pandey acknowledged that excessive trading activity around weekly options expiry remains an area of concern.
“Hyperactivity on expiry is an issue,” he said, adding that the Securities and Exchange Board of India (SEBI) has already introduced six measures to address risks in the derivatives segment.
“Six measures have been put in place… give it a go,” he said, signalling that the regulator intends to evaluate the impact of recent steps before considering further intervention.
He pushed back against calls for immediate additional tightening.
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“Do not jump to kill the markets in the context of market volatility with options,” Pandey said.
“Be patient. Look at the data. Analyse it. Do not jump into another set of measures so soon.”
He added that SEBI will soon release fresh data to provide greater clarity on the volatility debate. “We will certainly put out the data soon; a consultation paper will follow,” he said.
Finfluencers and Retail ‘Dreams'
Pandey also addressed the rise of finfluencers and their impact on retail participation in options trading.
“The finfluencer market has been developing on its own since Covid,” he said.
According to him, some of these platforms “sell dreams to people, often with false claims”, contributing to heightened trading activity.
He noted that many retail participants were paying for courses to learn options strategies, only to incur losses once they began trading in live markets.
“People were paying to learn how to use options, and then losing money when actually trading,” Pandey said, highlighting the need for greater investor awareness alongside regulatory safeguards.
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