NSE Defers Change In Futures & Options Expiry Day: What It Means For Traders & Investors

The National Stock Exchange of India (NSE) has announced the deferral of its decision to shift the expiry day for Futures & Options (F&O) contracts from Thursday to Monday, originally scheduled for April 4. This decision comes in response to a recent consultation paper issued by the Securities and Exchange Board of India (SEBI) on March 27, 2025.

SEBI's Proposal for Uniform Expiry Days
SEBI's consultation paper proposes limiting F&O expiries to Tuesdays and Thursdays, excluding benchmark index options like Nifty 50 and Sensex. The objective is to introduce greater predictability in trading activities and reduce market volatility. Additionally, SEBI suggests that all other equity derivatives contracts should have a minimum one-month tenor, expiring in the last week of every month on designated days. Any future changes to F&O expiry dates will require prior approval from SEBI.

Impact on Market Stability and Participation
Financial experts have welcomed SEBI's move, emphasizing its potential to stabilize the market. Sugandha Sachdev, Founder of SS WealthStreet, highlighted, "SEBI has now proposed that there are going to be only two weekly expiries, Tuesday and Thursday.  So that practically maintains the status quo on the previous expiries, both the exchanges  are now allowed to have one weekly expiry, weekly option contract and a monthly expiry. So this will boost participation in the market and lead to a lot of predictability."

Anand K. Rathi, Co-Founder of MIRA Money, noted, "The introduction of a uniform settlement date, particularly for index derivatives, is a significant step forward. This standardization across exchanges is a positive development that could greatly enhance market stability. The current situation, with its multitude of expiry dates, often leads to excessive volatility and significant losses for investors, particularly new ones. By addressing this issue, the regulatory change could help reduce market instability."

However, not all experts see immediate impact. Sushil Kedia, founder of Kedianomics, refrained from commenting, stating, "I see nothing of impact in this." This sentiment reflects ongoing debates within the financial community regarding the practical implications of SEBI's proposed changes.

Future Outlook and Regulatory Oversight
With the deferral of NSE's proposed changes, weekly and monthly F&O contracts will continue to expire on Thursdays until further regulatory clarity is achieved. SEBI's consultation period invites feedback from stakeholders, indicating a deliberate approach towards enhancing market operations.