F&O volumes likely to decline 30% on tighter peak margin regulation

Retail participation in the F&O segment - especially that for options writers on expiry days - has already been impacted owing to these norms, which became effective from December 1

retail investors, funds, F&O, STOCK market trading
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Peak margin rules dictate a short-margin penalty — ranging from 0.5-5 per cent of the shortfall per day — if brokers fail to secure the minimum margin for intraday positions | Illustration: Binay Sinha

Ashley Coutinho Mumbai
A further 20-30 per cent decline in retail derivatives volumes is likely as phase two of peak margin norms kicks in from March 1. Retail participation in the F&O segment — especially that for options writers on expiry days — has already been impacted owing to these norms, which became effective from December 1.

The derivatives turnover on weekly expiry days on the NSE in December in the index futures segment, for instance, came off 41 per cent over the previous month, while that for index options reduced 19 per cent, the data from brokerage Prabhudas Lilladher showed.

Peak margin rules dictate

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First Published: Feb 22 2021 | 10:21 PM IST

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