Brokers' lobby Anmi calls for expansion of F&O universe and other reforms

Brokers lobby group Association of National Exchanges Members of India (Anmi) on Friday called for an expansion of the stock universe eligible for futures and options (F&O) to deepen the cash market.

 

"To strengthen the equity market, Anmi recommends widening the universe of stocks eligible for derivatives trading. India currently maintains some of the most restrictive eligibility norms globally, with only a limited number of stocks qualifying for F&O," the association said in a release.

 

The suggestion is part of a list of several other recommendations that the association plans to put forward to the Securities and Exchange Board of India (Sebi).

 

Anmi is also seeking relaxation of rules to strengthen the securities lending and borrowing (SLB) ecosystem. It said that high margin costs and low retail awareness has plagued growth of the segment.

 

The other suggestions include revival of the currency derivatives segment through regulatory support from Sebi and the Reserve Bank of India (RBI).

 

"Anmi urges both regulators to collaborate and bring clarity to participation norms, including restoration of access for unhedged positions. Reviving this segment is vital for exporters, importers, and institutions to effectively hedge currency risk in a globally integrated economy," the release stated.

 

The association has called for introduction of co-location services in commodity markets. It has also recommended the launch of a fixed income index derivatives linked to government and corporate bond benchmarks.

 

Speaking to the media, Anmi President K Suresh said there is also a need for some entry barriers in the F&O market to ensure that only informed investors enter the space. The barrier, he said, could be an examination or minimum net worth criteria.