Neutral impactStocks
SEBI is said to ease arbitrage mutual fund rules to aid closing auction session
Mint 1 hr ago·16 Sept 2026, 7:15 am
Regulatory authorities are reportedly considering a relaxation in rules for arbitrage mutual funds. This change would allow these funds to hold unhedged positions for a short period during the closing auction session. The move is intended to give fund managers more flexibility in managing their portfolios during this specific window.
For investors, this policy shift could improve the efficiency of the closing auction process. By permitting temporary unhedged exposure, funds may be better equipped to handle large orders, potentially leading to more accurate price discovery. This is expected to benefit the broader market by reducing volatility during the final trading session of the day.
Investors should watch for the official notification from SEBI. The exact implementation details and the duration of the relaxed rules will be crucial to monitor. This development highlights the regulator's ongoing efforts to refine market mechanisms and support liquidity in the cash segment.
Excerpt from Mint
SEBI is said to allow arbitrage mutual funds to temporarily carry unhedged positions of as much as 1% of their plans worth a total of ₹ 3 lakh crore. India’s market regulator is said to have given arbitrage mutual funds more flexibility in managing their positions, according to people familiar with the matter, seeking…Read the original at Mint
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- Category: Stocks.
- Assessed as a significant, market-relevant update.
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