Reports of curbs on weekly options expiry speculative: Sebi Chief

Synopsis

Sebi chief Tuhin Kanta Pandey dismissed reports of curbs on weekly options expiry as speculative, emphasizing the need for structural reforms in equity derivatives. He clarified no communication occurred with the finance ministry regarding this matter. Pandey also urged portfolio managers to curb misleading performance claims to maintain industry trust and ensure clear client communication.

Mumbai: Sebi chief Tuhin Kanta Pandey on Wednesday said reports suggesting curbs on weekly options expiry are 'speculative'.

"We need some reforms. But what will be the nature of those reforms and how will it be treated - as per our practice we always discuss it with the markets. Whenever we envisage such concrete measures, we will certainly inform the market and come out in the open for consultations as in the past," Pandey said.

Speaking on the sidelines of the annual Association of Portfolio Managers in India (APMI) conclave here, the regulatory body head said there is need for structural reforms in the equity derivatives segment.

He clarified that there has been no communication between Sebi and the finance ministry regarding weekly options expiry.

There were media reports that the finance ministry and Sebi were considering ways to reduce options market speculation and increase cash market volumes.

Following his comments, BSE shares recovered after a fall in early trade Wednesday to end at ₹2,388.

At the APMI event, the Sebi chairman said at the industry body's request the regulator has set up a working group to address the concerns of custodians, depositories and other market participants.

Misleading claims
He said the industry must curb misleading claims being made by a few registered portfolio managers as such exaggerated performance claims undermine trust and could stall growth of the industry. "Your client communications must be clear: eliminate ambiguity, communicate performance claims responsibly, and formally document any strategy changes," Pandey said.

There are 479 registered portfolio managers with Sebi as of June 30.

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