SEBI’s New F&O Rules: Zerodha to Reassess Pricing Post-Nov 20, Impacting 60% of Trades, Says CEO Nithin Kamath

SEBI has introduced new rules for Futures & Options (F&O) trading, which will come into effect from November 20, and Zerodha, a popular stock brokerage, is reviewing its pricing structure due to these changes. Nithin Kamath, Zerodha’s CEO, shared in a post on X (formerly Twitter) that these changes could impact 60% of F&O trades and 30% of total orders for Zerodha.

The key changes include limiting weekly expiries to just one per exchange, meaning that exchanges like NSE will have to choose between Nifty 50 or Bank Nifty for weekly expiries, while all other indices will switch to monthly expiries. Additionally, the contract size for index F&O will increase from ₹5-10 lakh to ₹15-20 lakh.

Starting February 2025, traders won’t get margin benefits on calendar spreads for contracts expiring on the same day, which means they’ll need more margin to trade. SEBI has also introduced a 2% Extreme Loss Margin (ELM) on expiry day to handle risks from increased volatility. Kamath said Zerodha will decide on any changes to its pricing structure after assessing how these new rules affect their business.