FPI instruments with derivatives as underlying assets barred
Financial Express Delhi|December 18, 2024
THE SECURITIES AND Exchange Board of India (Sebi) has barred foreign portfolio investors (FPIs) from issuing offshore derivative instruments (ODIs) with derivatives as underlying assets or using derivatives to hedge their ODIs in India in a bid to curb regulatory arbitrage.
AKSHATA GORDE

"A foreign portfolio investor shall not hedge their ODIs with derivative positions on stock exchanges in India...ODIs shall only have securities (other than derivatives) as underlying and shall be fully hedged with the same securities on a one-to-one basis, throughout the tenure of the ODI," Sebi said in a circular on Tuesday.

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