Securities watchdog SEBI recently updated the criteria for including stocks in the futures and options segment. Analysts estimate this could lead to approximately 80 potential new additions to the list. Meanwhile, around 18 existing stocks may be excluded due to failing to meet the threshold under the revised framework.
Two notable names touted as strong candidates for entering the derivatives market soon are Jio Financial and Zomato. Research firms note adding these stocks to F&O trading within the next few months could prepare them to be included in key indices like Nifty 50 at the next review. Allowing options on these new-age companies' shares would excite investors.
Leading brokerages have produced lists of likely inclusions and exclusions based on publicly available data and the SEBI's new standards. Large firms from various sectors feature prominently on the potential additions list, including insurance giant LIC, green energy provider Adani Green, and depository major CDSL. Several emerging businesses in areas like fintech, logistics, and food delivery may also get the green light for options.
On the other hand, some established but smaller healthcare and utility stocks are predicted to depart the F&O segment should they fail to consistently meet the product viability metrics over the coming reporting cycles. An objective framework will regularly assess names at risk of getting removed to uphold market integrity.
The revised norms aim to boost liquidity and trade quality on derivatives of only sufficiently sound securities. If the forecast impacts pan out, options traders will soon have many new investment avenues to explore and manage their risk exposure on.
