Did SEBI Approve NSE's Derivatives Expiry Change?

Mumbai, June 17 (NationPress) The National Stock Exchange (NSE) announced on Tuesday that it has secured approval from the capital markets regulator SEBI to shift the expiry day for equity derivatives contracts from Thursday to Tuesday.

This strategic change is part of an overarching initiative to harmonize expiry days across various exchanges and mitigate volatility. The revised expiry schedule is set to take effect from September 1, 2025.

Meanwhile, the Bombay Stock Exchange (BSE) has been authorized to retain Thursday as its expiry day starting from Tuesday.

In its proposal, the exchange expressed a preference for Thursday as its settlement day, which SEBI has approved.

Both exchanges have circulated official notices detailing the adjustments following SEBI's directive that was released in May.

The NSE has indicated in its circular that all current contracts will maintain Thursday as their expiry day, with the exception of long-dated index options, which may be realigned according to prior practices.

For new contracts, those set to expire on or before August 31, 2025, will also adhere to the existing Thursday expiry.

However, beginning on September 1, 2025, the expiry will transition to Tuesday, with monthly contracts concluding on the last Tuesday of each month.

Simultaneously, the BSE has issued a circular that follows a comparable format. All existing contracts will retain their current expiry schedule, with adjustments made to long-term index options if needed.

New contracts set to expire on or before August 31, 2025, will also maintain the Tuesday expiry. From September 1, 2025, the BSE will officially shift its expiry day to Thursday.

Additionally, the exchange has declared that it will cease the introduction of new weekly index futures contracts starting from July 1.

These decisions were taken following extensive discussions within SEBI’s Secondary Market Advisory Committee (SMAC), aimed at achieving consistency in expiry days and facilitating smooth transitions between the exchanges.

This modification is also anticipated to curtail excessive speculation and enable exchanges to concentrate on cultivating sustainable trading patterns.

With this development, the NSE is looking to reclaim a portion of its market share in derivatives trading, especially after the BSE made significant advancements by launching contracts with a distinct expiry day.

Derivatives play a vital role in generating revenue for both exchanges, and a clear differentiation in expiry schedules could significantly influence future trading volumes.