SEBI Mandates Standardised F&O Expiry Days: Exchanges to Choose Between Tuesday or Thursday by June 15, 2025

Significant changes are coming to India’s stock markets. To make things smoother and safer for investors, the Securities and Exchange Board of India (SEBI) has ordered all stock exchanges to standardise expiry days for equity derivatives. Starting June 15, 2025, exchanges must pick either Tuesday or Thursday as their official expiry day for these contracts; no more mixing it up.

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Why SEBI’s Doing This

Let’s rewind for a moment. Until now, exchanges have been able to set different expiration days for other contracts. That flexibility led to a fragmented system, causing sudden market activity and volatility spikes, especially on expiry days. SEBI saw this as a growing problem, especially for everyday investors.

In October 2024, SEBI tried to rein things in by limiting weekly options contracts to just one benchmark index per exchange. However, some exchanges found ways around that, offering contracts that expired on different days and keeping the door open for excessive speculation. This latest move aims to shut that door for good.

How It’ll Work

Here’s the breakdown:

• One day only: Exchanges must choose either Tuesday or Thursday for weekly expiries of their main index options.
• Monthly contracts: All other equity derivatives must expire in the last week of the month and only on the selected day.
• No surprises: Exchanges must tell SEBI which day they choose by June 15, 2025, and they’ll need permission to change it.
   

What This Means for NSE and BSE

NSE (the bigger player) uses Thursdays for expiry, and BSE sticks with Tuesdays. But there’s a twist: NSE is thinking about switching to Tuesday, which could shake things up. BSE might feel pressured to move to Thursday to keep its competitive edge if that happens.

Market analysts think NSE’s shift could boost its share in index options trading by around 5%, a big deal in this high-volume space.

What the Market’s Saying

So far, the reaction has been positive. Investors and traders see this as a smart move, with less confusion, fewer sudden spikes, and a more predictable market overall.

Still, there’s some hesitation. If both NSE and BSE use the same expiry day, it might lead to sudden surges in trading activity on that day, possibly affecting liquidity and volumes.

Wrapping It Up

This may sound like a technical tweak, but it’s a significant shift in India’s equity derivatives landscape. SEBI’s goal? A fairer, simpler, and more stable market. And with the exchanges now on the clock to finalise their expiry days, all eyes will be on how this plays out over the next few weeks. Stay tuned; this could reshape how and when India trades.