Priyanka Tiwari
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The Securities and Exchange Board of India (SEBI) has confirmed that it is not planning to introduce exams for investors trading in futures and options (F&O). SEBI Whole-Time Member Ananth Narayan addressed the speculation during a press conference held after the board meeting on March 24, 2025.
Focus Remains on Awareness and Systemic Protection
When asked about the possibility of investor eligibility being determined through exams like the National Institute of Securities Markets (NISM) certifications, Narayan responded clearly:
“Are we specifically looking at anything (as entry barriers like NISM exams for investors) at this point in time? No.”
SEBI Chairman Tuhin Kanta Pandey added that the regulator's strategy remains focused on increasing investor awareness and introducing systemic improvements to protect small investors from manipulation and market risks.
Investor Risk Awareness Already Built Into the System
Narayan elaborated that even without a formal SEBI mandate, exchanges had implemented risk awareness measures for F&O traders as early as 2012. Exchanges, acting as first-line regulators, have agreements with brokers requiring them to ensure that investors understand the market's risks.
SEBI’s Focus on Expiry Day Volatility
He also addressed SEBI’s recent circular dated October 1, 2024, which was introduced to curb overtrading and volatility, especially on index option expiry days. Key changes in that directive included:
Reducing the number of weekly expiry index derivative contracts
Introducing additional margin requirements
Increasing the minimum contract size
These steps aim to protect investors and enhance market stability without restricting participation through exams or additional licensing barriers.
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