SEBI Sets Intraday Position Limits for Equity Index Derivatives

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  • Last Updated on 3 September, 2025

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SEBI Intraday Position Limits

Circular No. SEBI/HO/MRD/TPD/CIR/P/2025/ 122, Dated: 01.09.2025

1. SEBI Notifies Framework for Intraday Position Limits

The Securities and Exchange Board of India (SEBI) has officially notified the Framework for Intraday Position Limits Monitoring in Equity Index Derivatives. The move aims to strengthen risk management in the derivatives market and provide a more robust mechanism for monitoring intraday exposures of market participants. By introducing this framework, SEBI seeks to ensure orderly functioning of markets and mitigate systemic risks that may arise from excessive intraday exposures.

2. Entity-Level Monitoring for Index Options

A key feature of the framework is the entity-level intraday monitoring system, specifically designed for index options. This approach ensures that market participants, including liquidity providers and market makers, operate within defined risk boundaries. The monitoring at the entity level will provide better oversight of exposures and prevent concentration of risks, thereby supporting market stability while allowing active participation.

3. Net and Gross Position Limits Defined

Under the new framework, SEBI has laid down clear quantitative thresholds. The Intraday Net Position Limit has been fixed at ₹5,000 crore, while the Intraday Gross Position Limit has been capped at ₹10,000 crore. These limits are expected to provide a balance between enabling adequate trading flexibility and safeguarding the market against potential volatility triggered by oversized positions.

4. Enhancing Market Integrity and Stability

The introduction of this framework reflects SEBI’s continuous efforts to strengthen risk control measures in the derivatives segment. By capping intraday positions and ensuring real-time monitoring, the framework will help in reducing the risk of defaults and maintain investor confidence. At the same time, SEBI has provided enough flexibility for genuine market activity, ensuring liquidity and fair participation in the equity derivatives market.

Click Here To Read The Full Circular

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Author: Taxmann

Taxmann Publications has a dedicated in-house Research & Editorial Team. This team consists of a team of Chartered Accountants, Company Secretaries, and Lawyers. This team works under the guidance and supervision of editor-in-chief Mr Rakesh Bhargava.

The Research and Editorial Team is responsible for developing reliable and accurate content for the readers. The team follows the six-sigma approach to achieve the benchmark of zero error in its publications and research platforms. The team ensures that the following publication guidelines are thoroughly followed while developing the content:

  • The statutory material is obtained only from the authorized and reliable sources
  • All the latest developments in the judicial and legislative fields are covered
  • Prepare the analytical write-ups on current, controversial, and important issues to help the readers to understand the concept and its implications
  • Every content published by Taxmann is complete, accurate and lucid
  • All evidence-based statements are supported with proper reference to Section, Circular No., Notification No. or citations
  • The golden rules of grammar, style and consistency are thoroughly followed
  • Font and size that's easy to read and remain consistent across all imprint and digital publications are applied