The Hindu Business Line : Scope of MF participation in derivatives enhanced: SEBI

The Securities and Exchange Board of India (SEBI) has announced that it has enhanced the scope of mutual funds' participation in the derivatives market.

The capital market regulator on Wednesday said it has permitted mutual funds to participate in the derivatives at par with foreign institutional investors (FIIs).

At present, mutual funds are permitted limited participation in the derivatives market mainly for hedging and rebalancing their portfolio. This restriction was imposed in 2002.

"Since then, there have been several changes in the structure of the cash market and the volumes in the derivatives market have increased manifold. It is also observed that there has been a significant increase in retail participation in the derivatives market," SEBI said.

SEBI said mutual funds would be treated at par with a registered FII in respect of position limits in index futures, index options, stock options and stock futures contracts. "Mutual funds will be considered as trading members like registered FIIs and the schemes of mutual funds will be treated as clients like sub-accounts of FIIs," it said.

Article E-Mail :: Comment :: Syndication :: Printer Friendly Page

Stories in this Section
IRDA moots stand-alone agri-insurance companies

Madras HC grants interim stay on fringe benefit tax

6 in fray for Mumbai airport project, 5 for Delhi — Entire process to be completed by year-end

High drama as bidders submit papers

Govt open to selling residual stake in MUL

T & Z groups account for 25 pc of BSE volumes

Scope of MF participation in derivatives enhanced: SEBI

TRAI sets the ball rolling for digitisation of cable TV — Sets 2010 Commonwealth Games as deadline