SEBI Approves NSE Move to Shift Equity Derivatives Expiry to Tuesday Starting September 1
Mumbai — In a significant move aimed at harmonizing market operations and reducing volatility, the National Stock Exchange (NSE) has announced a shift in the equity derivatives expiry day from Thursday to Tuesday, effective September 1, 2025. The decision comes after receiving approval from the Securities and Exchange Board of India (SEBI).
At the same time, the Bombay Stock Exchange (BSE) has been allowed to maintain Thursday as its official expiry day, marking a key development in India’s fast-growing derivatives market.
Why This Matters: A Step Towards Market Streamlining
The change in expiry schedules is part of a broader regulatory push to streamline expiry days across exchanges, a move that experts say could help:
- Reduce volatility on expiry days
- Minimize operational risks
- Encourage more balanced trading activity
- Foster sustainable growth in the derivatives segment
According to SEBI, these changes stem from extensive deliberations within its Secondary Market Advisory Committee (SMAC).
What’s Changing for NSE
Per the NSE circular:
- All existing contracts will continue to expire on Thursdays
- Long-dated index options may be realigned, as per historical practices
- New contracts expiring on or before August 31, 2025, will follow Thursday expiry
From September 1, 2025, expiry shifts to Tuesday
Weekly contracts will expire every Tuesday- Monthly contracts will expire on the last Tuesday of each month
- This strategic change is being seen as NSE’s effort to reclaim market share in equity derivatives after BSE gained traction by offering an alternate expiry day.
What’s Changing for BSE
BSE, in its own circular, confirmed that:
- All existing contracts will continue as-is with Tuesday expiries
- From September 1, 2025, BSE will shift expiry day to Thursday
- Long-term index options will be adjusted where applicable
- BSE will stop introducing new weekly index futures contracts from July 1, 2025
The exchange had proposed Thursday as its preferred settlement day, and SEBI has accepted the recommendation.
What Traders and Investors Need to Know
Key Dates:
-
July 1, 2025: BSE halts new weekly index futures introductions
-
August 31, 2025: Cut-off for existing expiry schedules
-
September 1, 2025: New expiry days officially come into effect:
- NSE → Tuesday
- BSE → Thursday
- Trading Strategy Adjustments: Investors and institutions will need to realign expiry-based strategies
- Arbitrage Opportunities: Different expiry days across exchanges may open new windows for arbitrage
- Reduced Crowding: Spread-out expiries aim to reduce concentration of volumes on a single day
Regulatory Context: Why SEBI Intervened
In recent months, concerns were raised over volatility spikes and speculative behavior linked to expiry-day dynamics. SEBI, in coordination with exchanges and SMAC, concluded that a diversified expiry calendar could reduce systemic pressure.
“This change aims to balance liquidity, limit excessive speculation, and harmonize settlement practices,” said a senior SEBI official familiar with the matter.
A Tug of War for Derivatives Market Share
Derivatives trading—particularly index options—constitutes a major source of revenue for both NSE and BSE. In 2023 and 2024, BSE saw significant growth in market share after introducing Tuesday expiries, drawing traders looking for arbitrage and lighter liquidity competition.
With NSE now reclaiming Tuesday as its expiry day, analysts anticipate a renewed competition between the exchanges.
“This move is NSE’s attempt to bring back volumes by aligning more favorably with trader preferences while also working with SEBI to reduce concentrated risk,” said market analyst Ravi Mittal.
What Happens to Existing Positions?
There will be no change to existing contracts—investors currently holding derivatives with Thursday expiries need not worry. The transition only applies to new contracts listed from September 1 onwards.
Brokerages are expected to update their systems in advance and inform clients about changes to margin requirements, rollovers, and expiry settlement dates.
A More Balanced Market Ahead?
The shift in expiry schedules for equity derivatives marks an important chapter in India’s capital market reforms. As NSE moves to Tuesday and BSE to Thursday, SEBI hopes to create a more resilient, efficient, and investor-friendly derivatives ecosystem.
Whether this dual-expiry structure will improve market health or lead to fragmented liquidity remains to be seen. But one thing is clear—traders must adapt their strategies to stay ahead.
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