SEBI to implement physical settlement in derivatives - Arihant Capital Markets

Anita Gandhi, Whole Time Director at Arihant Capital Markets

"SEBI's move to implement physical settlement in the derivative segment, is expected to revive the stock lending and borrowing (SLBM) market. However it could impact over all activity in F&O segment. Though it is difficult to judge the exact impact, iIf implemented, we may see drop in volumes initially. This effort will also bring our exchange in parity to the global standards. It will also help in bringing down speculative element from the F&O segment. We may also see lot of arbitrage opportunities emerging from this move.

The stock market regulator, in a circular on Wednesday, set the criteria for stocks to be physically or cash settled. A stock will be chosen from the top 500 stocks in terms of average daily market capitalisation and average daily traded value in the previous six months on a rolling basis".

Source : Equity Bulls

Keywords