Sebi to review derivatives settlement pricing after market uproar over CAS
Rediff 1 hr ago·4 Sept 2026, 10:43 am
The Securities and Exchange Board of India (Sebi) has announced a review of the pricing mechanism for derivatives settlement, prompted by significant market feedback. The regulator is specifically looking at the Cash Settlement (CAS) process, which is used when a stock is not available for delivery. The move follows recent volatility where the CAS price was set below the closing market price, causing confusion and losses for traders.
This decision is important for investors as it aims to bring more transparency and fairness to the derivatives market. By re-evaluating the pricing formula, Sebi hopes to prevent situations where settlement prices do not reflect the actual market value, which can lead to unfair outcomes for retail participants.
Investors should watch for the final guidelines from Sebi. Any changes to the CAS pricing structure could impact how derivatives are traded and settled, potentially reducing future volatility in the market.
Excerpt from Rediff
India's market regulator, Sebi, is poised to revise the methodology for determining derivative contract settlement prices, responding to widespread market feedback and concerns over 'sharp price spikes and distortions' since the implementation of the Closing Auction Session mechanism. Sebi will issue a consultation…Read the original at Rediff
Key takeaways
- Category: Economy.
- Flagged as a high-impact, market-moving story.
Why it matters
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