Neutral impactEconomy
SEBI to partly reverse derivative settlement rules after pushback, sources say
CNBC-TV18 1 hr ago·5 Oct 2026, 10:45 am
Market regulator SEBI is reportedly set to reverse a controversial rule change that would have used the closing auction price for all stock settlements. Instead, the new plan is to use the volume-weighted average price (VWAP) from the final 30 minutes of trading for derivatives. This approach is expected to remain in place for at least a year, while the closing auction will continue for less-liquid cash market stocks.
This shift is a direct response to strong feedback from market participants who argued that the previous rule could have artificially suppressed stock prices during the final minutes of trading. By reverting to the VWAP method, SEBI aims to ensure a smoother and more representative price discovery process for derivatives, which are essential tools for hedging and speculation.
Investors should monitor the official circular from SEBI, which is expected by month-end. The key takeaway is that the volatility often seen in the last 30 minutes of a session will now be better reflected in derivative contracts, potentially reducing sudden price gaps for traders.
Key takeaways
- Category: Economy.
- Assessed as a significant, market-relevant update.
Why it matters
A meaningful update worth tracking. Use the price and stock snapshot to gauge how the market is responding.
