India's markets regulator has proposed lowering position limits for equity stock derivatives and tightening rules for index derivatives, in a bid to further reduce the build-up of risk in these markets.

Equity derivatives are contracts between investors to buy or sell an underlying asset at a future date and price

India’s market regulator, the Securities and Exchange Board of India (SEBI), has proposed new measures to limit risks in the derivatives market. The changes include reducing position limits for equity derivatives and tightening rules for index derivatives.

India's markets regulator has proposed rules to curb possible manipulation and limit the spill-over of volatility from equity derivatives into the broader cash market, which has slipped sharply after hitting record highs in September 2024.