Fiis Get Leeway On Exposure

The Securities and Exchange Board of India (Sebi) has said the limit on individual foreign institutional investor (FII) investments in domestic companies excludes their holdings in derivatives such as options and futures.

This rule will, however, hold only as long as derivative contracts continue to be settled in cash, the Sebi said in a circular. The markets regulator had permitted FIIs to trade in derivatives last year.

All contracts in derivatives are currently settled in cash, and physical delivery does not take place.

A FII can now hold up to 10 per cent of a company