Hi bank nifty index stocks weightage is being restructured i.e no single stock should have more than 20% weightage and top 3 stocks weightage should not be more than 45%.
I bought hdfc and ICICI Bank call options for Nov expiry hoping after results stocks may go up, but as usual SEBI rubbed me in the wrong way, should I wait or close calls?
Note:
Wherever I go why SEBI comes behind and spoils my party, while Jane Street like thieves are laughing all the way to their bank.
And at the end of the year SEBI will come and say 99% of traders lose, how much % of this is SEBI’S fault?
Without SEBI, it would be worse.
i don’t understand , suppose previously they were buying hdfc icici and sbi for say 6000 crores ( as they had 60 % weightage ), now they buy hdfc , icici, sbi , axis and kotak in the same ratio say they buy of 9000 crore , those guys have unlimited capital . I don’t think this will be an issue for them .
What will be the probable new weightage of hdfc , icici, sbi, and axis bank in bank nifty index after SEBI changes in weightage limit?
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My understanding is that Weightage of a stock in Index is calculated based on Free Float Market Cap. How do u control that?.
It is not just that.
There are additional rules that can limit a scrip from qualifying for an index,
or further limit the maximum weigtage of a scrip,
and other such additional limits
(justifiably?) to limit risk (eg. concentration risk).
Here are a few such for NIFTY 50.
Source: Rules/methodology of the NIFTY Equity Indices.
Also, on a somewhat related/tangential note, it is free-float market cap,
which is significantly different from market-cap, for certain securities.
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Without knowing the above,
why the feeling that the following “hope” is now less likely?
- Was there some significant price movement recently?
- One that we expect to be sticky till the options expire?
- One that we expect to be sticky till the options expire?
FWIW, the tweaking of limits was proposed ~5 months ago, with the proposed deadline of 03-11-2025. One may argue that a retail investor, even one who regularly reads the “financial news” (that is known to be biased towards creating outrage and engagement, rather than being informative) is not well positioned to know such details and plan accordingly. Hopefully, this is a stark reminder of how little one knows the game one is playing.
Source: Refer Section 5.7. Eligibility criteria for Derivatives on Non-Benchmark indices of SEBI | Measures for Enhancing Trading Convenience and Strengthening Risk Monitoring in Equity Derivatives.
Even if one was blissfully unaware of the above circular from 29 May 2025, it is evident from the previous regulatory updates, that we are currently in a known extremely volatile period with ongoing/continued regulatory changes. Continuing to participate in the market with the expectation that it is a well defined one to speculate in (which it is not) appears to be an unrealistic expectation (IMHO).
Coming back to the topic at hand,
the updated limits on index constituents to limit concentration risk,
are set to apply
- in a single tranche for BANKEX, FINNIFTY by 31 Dec 2025.
- in a phased manner (4 monthly tranches) for BANKNIFTY by 31 Mar 2026.
- Index weight adjustment = (desired weight - actual weight ) / number of months left
starting from Dec 2025.
- Index weight adjustment = (desired weight - actual weight ) / number of months left
Source: Section 4 of SEBI | Implementation of eligibility criteria for derivatives on existing Non-Benchmark Indices
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