SEBI Modifies the Framework for Price Band Formulation for Scrips in the Derivatives Segment to Manage Volatility

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Last Updated on 28 May, 2024

derivatives scrips

Circular No. SEBI/HO/MRD/TPD-1/P/CIR/2024/58, Dated: 24.05.2024

SEBI has modified the framework for price band formulation for scrips in the derivatives segment, enhancing dynamic price bands. Key updates include increasing the conditions for flexing price bands to 50 trades and 10 unique UCCs, aligning price bands for cash market and futures contracts, extending cooling-off periods, and implementing a Sliding price band on account of flexing. These changes, effective from 03.06.2024, aim to strengthen volatility management and reduce information asymmetry in phases.

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