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Introduction of future contracts on Corporate Bond Indices - SEBI - SEBI/HO/MRD/MRD-PoD-3/P/CIR/2023/11

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..... AA+ and above. To start with, the Stock Exchanges are permitted to launch future contracts on corporate bond indices. 3. The details regarding index composition, contract specifications, position limits, risk management framework, etc. for introduction of future contracts on corporate bond indices are given at Annexure A. 4. The stock exchanges desirous of introducing such contracts shall submit a detailed proposal to SEBI for approval, inter alia, providing details relating to underlying corporate bond index, the index methodology, contract specifications, applicable trading, clearing & settlement mechanism, risk management framework, the safeguards to ensure market integrity, investor protection, surveillance systems, etc. 5. For impl .....

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Introduction of future contracts on Corporate Bond Indices - SEBI

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..... suer, group, sector, etc. v. Single issuer shall not have more than 15% weight in the index. vi. There shall be at least 8 issuers in the index. vii. The index shall not have more than 25% weight in a particular group of issuers [excluding securities issued by Public Sector Undertakings (PSUs), Public Financial Institutions (PFIs) and Public Sector Banks (PSBs)]. viii. The index shall not have more than 25% weight in a particular sector (excluding securities issued by PSUs, PFIs and PSBs). ix. The duration buckets of the index may be decided by the stock exchanges. x. The index shall have a track record of at least one year. 2. Contract Value The value of the CBIF contracts shall not be less than INR 2 lakhs at the time of introduction. Sto .....

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Introduction of future contracts on Corporate Bond Indices - SEBI

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..... hall be published on the stock exchange website. 8. Final Settlement Price Final settlement price for the derivative contracts shall be the closing price of the underlying index on the expiry day or last trading day of such derivative contracts. 9. Settlement Mechanism The contracts would be settled in cash in Indian Rupee (INR). 10. Settlement Day Settlement day shall be the next working day of the expiry day. 11. Position Limits Category Position limit Trading Members/ Mutual Funds / Insurance Companies /Housing Finance Companies/ Pension Funds / Banks and Primary Dealers dealing as clients/ Institutions belonging to Category I and II FPIs (i.e. other than individuals, family offices and companies) The gross open positions across all cont .....

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Introduction of future contracts on Corporate Bond Indices - SEBI

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