SEBI Includes Equity Exchange Traded Funds in list of eligible securities under Margin Trading Facility

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  • Last Updated on 2 December, 2022

Equity Exchange Traded Funds

Circular No. SEBI/HO/MRD/MRD-PoD-3/P/CIR/2022/166, Dated 30.11.2022

SEBI vide. Circular dated 13.06.2017 issued a comprehensive framework for Margin Trading Facility. Now, based on various feedbacks from market participants, SEBI has decided to allow units of Equity Exchange Traded Funds categorized as Group-I security as an eligible security for MTF as well as an eligible collateral under MTF.

Also, now Equity shares and units of Equity ETFs that are classified as ‘Group I security’ as per SEBI circular dated 23.02.2005 shall be eligible for MTF. Further, format for disclosure by the stock broker to the stock exchange on gross exposure towards MTF has been modified to include information with regard to MTF for units of Equity ETFs. SEBI has also clarified on sources of funds for the purpose of providing the MTF.

The provisions of this circular shall come into force with effect from 29.12.2022.

Click Here To Read The Full Circular

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