- A proposal to remove weekly expiry contracts has been submitted to SEBI by market participants
- The move aims to curb speculative activity in weekly options, the most traded Indian derivatives segment
- SEBI study revealed retail traders lost Rs 91,685 crore in futures and options during FY26
A proposal to remove weekly expiry contracts in the equity derivatives market has been floated by certain market participants to the Securities and Exchange Board of India (SEBI), as regulators and exchanges continue to grapple with rising retail losses in futures and options trading, top market sources told NDTV Profit.
The suggestion is aimed at reducing excessive speculative activity around weekly options, which have become the most traded segment of the Indian derivatives market. Proponents argue that curbing weekly expiries could help redirect investor money toward the cash market while also freeing up capital currently tied up in options-related margin requirements.
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The proposal comes against the backdrop of mounting concerns over retail investor losses in derivatives. A recent SEBI study showed individual traders incurred aggregate losses of Rs. 91,685 crore in the F&O segment during FY26, renewing debate over whether market structure changes are needed to discourage short-term speculation.
Another factor behind the discussion is the experience with the recently introduced Closing Auction Session (CAS). Market participants have pointed to sharp price swings and thin liquidity during the mechanism's initial weeks, arguing that concentrated trading activity around weekly expiry days may be amplifying volatility in certain segments of the market.
The suggestion comes at a time that SEBI has been examining ways to address persistent retail losses in derivatives markets. The Finance Ministry's remarks in the parliament point to SEBI measures reducing losses in F&O retail by Rs. 18,000 crore, but losses still stand at over Rs. 90,000 crore, as per a SEBI study.
At the same time, the regulator does not appear inclined to make major changes to the Closing Auction Session. SEBI Chairman Tuhin Kanta Pandey said last week that CAS is here to stay and that no significant changes are currently planned to the mechanism.
SEBI did not respond to a request for comment.
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