Securities and Exchange Board of India restores derivatives settlement method

Securities and Exchange Board of India: The Securities and Exchange Board of India serves as the primary regulator for the country's securities and derivatives markets, focusing on investor protection, market integrity, and regulatory oversight. In the recent development, SEBI has opted to restore the use of volume-weighted average prices from the final 30 minutes of continuous trading for settling equity derivatives on expiry days, delinking them from the closing auction session to address volatility issues. Market Adjustment: SEBI's action reverses aspects of a prior closing auction session rollout after it contributed to sharp price movements on expiry days. Derivatives Framework: The regulator is separating equity derivatives settlement calculations from cash market closing auction processes to promote stability.