SEBI has proposed a framework aimed at managing strike prices of options contracts to mitigate market volatility. This initiative seeks to ensure continuous availability of options contracts close to the prevailing market prices.
SEBI's New Framework for Strike Prices of Options Contracts
On May 27, 2026, SEBI announced a proposed framework designed to manage strike prices of options contracts effectively. This move comes in response to concerns about sharp intraday market volatility, which has raised issues regarding the availability of options contracts.
The proposed regulatory framework aims to enhance market operations by ensuring that options contracts remain available near the prevailing market prices. This will potentially increase liquidity and offer better protection against sudden market swings.
Practitioners in financial markets should monitor the progress of these proposals closely, as they could impact trading strategies and risk management approaches involving options contracts.
