• BSE stocks fell over 7% in the stock market on Tuesday, July 8.
  • Other capital market companies such as Angel One, CDSL and 360 ONE WAM also fell up to 6%.

What does it mean?

  • Options trading allows investors to trade using leverage (borrowed money).
  • SEBI's proposed rule will limit the leverage used by traders in options based on their activity in the cash segment (regular stock purchases/sales).

If this happening

  • This could increase liquidity in the cash market (there is more money flow here).
  • But it could reduce trading in options, especially among retail traders.

⬇️ BSE share execution

  • Since the SEBI action on Jane Street, BSE shares have fallen 13%.
  • On July 8 alone, the BSE fell 6.8% and was trading at Rs 2,456.9 at around 11:15 am.

 SEBI vs Jane Street: Background

  • SEBI has recently banned US-based Jane Street from India's securities market.
  • Reason: Jane Street was allegedly manipulating stock index prices using unfair trading strategies.
  • The firm reportedly earned over $2.3 billion from derivatives trading in India in 2023.
  • The action raised investor concerns, putting pressure on BSE shares.

Thought of expert

  •  Jefferies (International Brokerage)
  • According to Jefferies, the impact on BSE could be limited:
  • BSE earns 58% of its revenue from derivatives.
  • Foreign portfolio investors (FPIs) contribute only 3-4% of this.
  • Jane Street estimated the share to be just 1%.
  • Even in a worst-case scenario, BSE's earnings per share (EPS) could fall by only 0.6-0.7%.

 ICICI Securities

Found some warning signs:

  • Regulatory changes and high valuations could reduce trading volumes.
  • Average daily trading volume (ADTV) in premium contracts fell 12.4% to Rs 13,900 crore in June.

They believe:

  • BSE's stock price already reflects its growth potential.
  • The current valuation is more than 45 times the estimated EPS for FY27, which could be risky.

BSE and SEBI reaction


  • BSE and capital market stocks are under pressure due to SEBI's regulatory moves.
  • Retail options trading may be restricted if the new rules are approved.
  • While Jefferies sees limited downside, ICICI Securities is cautious due to high valuations and low volumes.
  • Investors should keep an eye on SEBI's official decisions before taking any action.