The Securities and Exchange Board of India (Sebi) has emphasized that while the subject of extended trading hours for equities derivatives is being considered, a definitive decision cannot be made until feedback from a broader range of market participants, including brokers and investors, is received.
This follows the National Stock Exchange's (NSE) request for extended trading hours for the derivatives or futures and options (F&O) segment.
According to Sebi Chairperson Madhabi Puri Buch, while market infrastructure intermediaries (MIIs) - stock exchanges, depositories, and clearing corporations - are an important part of the capital market ecosystem, extended trading hours for the F&O segment would include brokers as well, and thus their perspectives must be considered.
"With the exchanges, we discussed the subject. The ecosystem consists of three entities: exchanges, clearing firms, and depositories. Then there's the massive brokerage community and an even larger investor group. So, in order to have a full discussion on this problem, we need to hear their perspectives and replies," Buch explained.
"Since only one part of the ecosystem has approached us, we have communicated that feedback from the broking and investor communities is required." "We will make a decision only after we have analyzed their feedback," stated the Sebi chairperson.
This is significant because the NSE has been attempting to obtain regulatory approval for extended trading hours in the F&O segment, believing that such a move will allow traders and investors to gamble on global and domestic developments in a far more efficient and timely manner. In addition, many exchanges around the world have extended trading hours in the derivatives segment than the Indian bourses.
In a recent interview with Business Today, NSE MD & CEO Ashishkumar Chauhan stated that other exchanges that were mechanized much later than India already have longer trading hours, despite the fact that we have the technology to allow for longer trading hours.
"Technology allows us to extend trading hours, which is beneficial to investors as well as traders." Yes, there is a cost involved. "We have sent the proposal to Sebi," Chauhan added.
"We were the first automated exchange, and even though we only traded for two hours a day, trading activities took place all day." Our trading hours have risen over the years, and while the rest of the world automated much later, they are now trading for more than 20 hours daily," he noted.
