SEBI Board approves seven new derivative products

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Mumbai, Nov 14 (UNI) In order to encourage Indian markets to move onshore, the Stock and Exchange Board of India (SEBI) has approved the introduction of seven new derivative products.

The new derivative products, based on the interim recommendations made by the SEBI Committee on derivatives headed by Prof M Rammohan Rao, will provide investors with a larger range of risk mitigation products and create more activity in the Indian onshore markets, SEBI said in a statement here today.

''These products are also expected to bring transactions based on private-synthetic products to an exchange-traded transparent mechanism with appropriate regulatory supervision,'' SEBI said.

SEBI also mandated that a wider consultative process be followed before finalizing the specifications of these products and information about the products be disseminated to the market participants. However, the introduction of such products will depend on the product design, risk mitigation features and conformity to regulatory requirements.

In addition to these interim recommendations, the SEBI Committee is in the process of finalizing its recommendations on suitable OTC derivative products for the Indian markets. ''As soon as these recommendations are available, after due consultation, the board will take a decision on these products as well,'' SEBI added.


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