SEBI Board Meeting to Explore New Entry Rules for Single Stock Derivatives, Says Report

Sebi's upcoming board meeting on June 27 is keeping the financial industry on edge as people expect many notable proposals to be presented on the table. The market watchdog has recently been quite vocal about the prevalent issues in the markets.

As per a report by Zee Business, the market regulator might introduce new rules for single-stock derivatives and tighten its grip over finfluencers.

“The SEBI board is expected to be briefed about the new entry criteria for single stock derivatives, and the board is also expected to relook at the proposed separate regulations for delisting investment and holding companies. The issue was last discussed in the November board meeting, but more data and discussion were sought," sources cited in the report said.

SEBI is also contemplating measures to safeguard investors from unregistered research analysts and investment advisors by proposing that the respective fees should be paid through an exchange platform.

The regulator might also revisit regulations governing research analysts and investment advisors. But before these regulations are finalised SEBI plans to release a public consultation paper.

In India, there are fewer than 1,500 registered investment advisors, a stark contrast to the vast number of demat accounts present. It is worth noting that a large number of investment advisors are unregistered.

As the board meeting comes closer, discussions are expected to revolve around finalising procedures for charging recovery expenses to asset management companies' books.

Sources cited in the report also pointed out that mutual fund houses often incur massive costs associated with legal and recovery processes in cases of default.

The market regulator is planning to regulate the manner in which charges are applied to address any existing confusion on the subject.