The Securities and Exchange Board of India (SEBI) has approved changes to the expiry days for derivative contracts on major stock exchanges. The National Stock Exchange (NSE) will now have its NIFTY50 contracts expire on Tuesdays, while the Bombay Stock Exchange (BSE) will settle its SENSEX contracts on Thursdays. This decision comes as part of SEBI’s regulatory overhaul of the equity derivatives segment, which aims to reduce concentration risks and minimize volatility caused by multiple expiry events occurring throughout the week.
The new rules require all exchanges to align their weekly index derivatives expiries to either a Tuesday or a Thursday, eliminating the previous flexibility that allowed each exchange to set its own expiry day. NSE and BSE submitted their preferred expiry days to SEBI by June 15, 2025, with NSE opting for Tuesday and BSE proposing Thursday.
BSE changes derivative contract expiries
Both proposals have received SEBI’s approval. The new expiry days will come into effect from September 1, marking a shift from the earlier practice where expiry days were largely determined by the exchanges themselves. As part of the transition process, SEBI has directed that no fresh weekly index futures contracts should be introduced from July 1, 2025, to ensure a smooth migration to the revised expiry cycle.
Any changes in expiry days by exchanges must be pre-approved by SEBI. Analysts believe that SEBI’s new rules are designed to bring uniformity and stability to the derivatives market, enhance operational efficiency, and protect investor interests by avoiding the crowding of expiries on overlapping days. The staggered expiration dates across different exchanges are expected to provide a more balanced trading environment and reduce market volatility, offering traders more strategic flexibility.
