SEBI Considers Higher Position Limits for Commodities
By Market Desk
SEBI is reviewing higher position limits for non-agricultural commodity derivatives and phased physical settlement to boost market depth in India.
The Securities and Exchange Board of India is actively considering revisions to the regulatory framework for commodity derivatives. The regulator is exploring the possibility of raising position limits for non-agricultural commodity contracts to boost market depth.
Evaluating Regulatory Adjustments
Market participation has been a focal point for regulatory review as the exchange landscape evolves. The proposed updates target specific operational parameters within the derivatives segment.
Here are the key proposals under evaluation by the regulatory body:
Raising position limits for non-agricultural commodity contracts to attract a broader range of participants.
Introducing a phased transition toward mandatory physical settlement to ensure better price discovery.
Mitigating risks associated with sudden regulatory shifts by aligning derivatives with underlying physical markets.
These strategic adjustments aim to create better price discovery and alignment between the derivatives market and the underlying physical commodity markets. The phased approach to physical settlement is designed to ease the transition for market participants.