FIA has submitted a response to the Securities and Exchange Board of India's consultation paper on Ease of Doing Business – Framework for strike prices of options contracts.
FIA supports SEBI’s objective of improving the predictability and availability of option strikes, particularly during periods of heightened intraday volatility. FIA also supports the proposal to introduce new intraday strikes aligned with the direction of price movement, which would help market participants manage positions more effectively during volatile market conditions.
In its response, FIA recommends that SEBI prescribes minimum common standards across exchanges to support consistent implementation. FIA also highlights the importance of safeguards where open interest remains, so that market participants retain the ability to close out, hedge or adjust existing positions.
FIA further recommends that the framework include minimum requirements for in-the-money and out-of-the-money strike availability, clear operational arrangements for the dissemination of intraday strike changes through existing automated exchange channels, and a formal annual review process involving industry and market participants.
Read the response here.
