Ananth Narayan from SEBI disclosed that over 90% of traders in derivative contracts, particularly index options, are losing money. He emphasized the importance of reducing trading activity on expiry days to curb overtrading. SEBI introduced new rules to address this issue: reducing weekly expiries, increasing contract sizes, and imposing extra margins for contracts expiring on the same day. These changes aim to stabilize the market and minimize losses. Despite a drop in index options trading volumes, the derivatives market remains strong. Narayan noted that NSE’s derivative contracts are still 40 times higher than the next best exchange, indicating significant activity. SEBI aims to create a balanced trading environment to protect traders from substantial losses.
