F&O Expiry: Which day will the expiry be, Tuesday or Thursday, decision will be taken next week?:

News Topical, Digital Desk : Capital market regulator SEBI has recently taken an important decision and said that from now on all derivatives contracts (especially options) will have weekly expiry only on Tuesday or Thursday. Till now, expiry used to happen on different days on different exchanges (like NSE and BSE), which led to huge speculation and more trading noise. SEBI believes that this change will bring discipline and transparency in the market.

Expiry- It happens on the last Thursday of every month. On this day all the deals have to be settled.
If you want to take the deal forward then rollover on

Tuesday or Thursday – what difference will it make – Although there are 5 trading sessions for expiry on both the days (Tuesday/Thursday), but experts believe that it will have a direct impact on the trend, liquidity and trading strategy.

Tuesday Expiry:- There are 3 effective days like Friday, Monday and Tuesday for trading. Theta decay (decay of time value) is more beneficial for option sellers. Buyers also get more time to catch the direction.

Thursday Expiry:- Only Tuesday and Wednesday are available before expiry. Making a strategy is a bit challenging due to the rapidly decreasing time value. Friday's trading is completely missed.

What will change with this decision- Now exchanges like NSE and BSE will have to tell by June 15 on which day they want the expiry - Tuesday or Thursday. Earlier, traders who used to make strategies on different expiries of both the exchanges (Expiry Arbitrage) - will not be able to do so now.

How will trading change? In the initial period, intraday volatility may increase, because all positions will be settled on the same day. But in the long term, cleaner price discovery and better directional trades are expected. "Now there will be less speculative trading and investors will participate more thoughtfully," - Rohit Srivastava, India Charts.

Impact on brokers and investors- There will not be much impact on the income of broker firms, because the trading volume will just change by changing the day. Some experts believe that in the short term, the income of brokers can increase even more because traders will be more active in adapting themselves according to the new rules. This move of SEBI will bring a big change in the Indian derivatives market towards more transparency, less speculation and better planning. Now, traders will also have to make a smart strategy as there will be expiry of only one day every week.