As retail investors are increasingly incurring losses in equity index derivatives (F&O) trade, SEBI on Tuesday put in place as many as six measures to strengthen the derivatives framework, including raising minimum contract size.

The new norms for derivative trading will be rolled out in phases, starting November 20. Index derivative contracts with weekly expiries, increase in contract sizes and and increase in tail risk coverage by levying additional extreme loss margin (ELM) will be launched from that day.

The proposed changes follow a recent analysis by the Securities and Exchange Board of India (SEBI), which revealed the financial struggles of retail investors in the equity futures and options (F&O) segment.

Market regulator Sebi has tightened the derivative norms by rationalising the weekly expiry contracts for the options segment. Under the new rules, exchanges can offer expiry contracts for only one index.

Capital markets regulator Sebi is expected to take measures regarding the Futures and Options (F&O) segment very soon, in a bid to enhance investor protection, its senior official said on Tuesday. The statement comes a day after the Sebi board met on Monday and cleared several key proposals.