Sebi panel backs VWAP settlement, sending BSE, Groww and Angel One up over 3%

After reviewing more than 20,000 comments on its consultation paper, a SEBI committee announced support for using the volume-weighted average price (VWAP) method to settle derivative contracts. The decision lifted shares of BSE Ltd, Groww and Angel One by over 3% each, while Motilal Oswal Financial Services rose 2.5% and Anand Rathi Wealth climbed 1.2%. Market participants had asked SEBI to keep the existing 30-minute continuous trading session VWAP method before moving to a blended framework.

The recently introduced closing auction session had been linked to a sharp drop in futures and options trading volumes and increased volatility in the final trading hour. Chandan Taparia of Motilal Oswal said the panel’s recommendation, based on extensive feedback, is a positive step for the derivatives market and should help restore trading volumes. He noted that earlier, price swings of about 1% near the close made it difficult to manage options positions.