SEBI Changes Trading Rules: The Securities and Exchange Board of India (SEBI) has made some changes in the rules of trading. After the change in the rules, senior officials of listed companies will get great relief in trading. SEBI has reduced the minimum cool-off period between disclosure and implementation of trading planning from six months to four months. It has provided the facility of upper price limit for buy trade and lower selling limit for sell trade during trading planning.
20% price limit for buying and selling of shares (SEBI Changes Trading Rules)
The Securities and Exchange Board of India has allowed a 20 per cent price limit for buying or selling shares in the trading plan. The rule states, “In the event of corporate action relating to bonus issue and stock split after approval of the trading plan, the insider may make adjustments in the number of securities and price limits with the approval of the compliance officer and the same shall be notified to the stock exchanges on which the securities are listed.
SEBI further said that in case of non-implementation of the trading plan, the internal source should inform the compliance officer within two business days along with the reasons for the same.
Proposal made after feedback
Let us tell you that the market regulator has proposed changes in the trading plan after receiving feedback from the market about the trading plan. SEBI said that senior officials or key managerial personnel of companies have very little time to do their trades, as most of the time they have inside information, as well as the trading window required for financial results is also closed.
There is a possibility of change in these rules too
Let us tell you that last week SEBI and Union Finance Minister Nirmala Sitharaman had warned investors about Futures and Options (F&O) trading, but investors’ interest in F&O has not decreased. After which SEBI is preparing to make many changes in the rules of derivative trading.
A derivative is a formal financial contract that allows an investor to buy and sell assets for future dates. Derivative contracts have a pre-determined expiry date. Trading of index and stock options has grown rapidly in the last few years due to retail investors.