SEBI Intraday Trading Regulations 2026: What You Need to Know

This is a regulatory update for Indian intraday traders. The Indian financial trading regulator, the Securities and Exchange Board of India (SEBI) has rolled out changes to how intraday traders will participate in the market. These changes will affect:

• position limits on derivatives
• margin requirements
• option premiums,
• intraday monitoring and
• expiry-day risk

The changes target leveraged instruments and derivatives on stocks and indices, and these changes follow SEBI’s own review of its processes and frameworks. The latest review is based on its June 2026 consultation paper on Margin Trading Facility (MTF). This paper indicates that the regulator is still considering further changes to how leveraged trading is conducted in Indian markets.

What Was Behind the New SEBI Intraday Trading Regulations?

On 20 August, 2026, SEBI published findings regarding retail equity derivatives trading behavior and profitability for FY25–FY26. The findings were sobering.

• Roughly 87.7% of individual equity-derivatives traders lost money in FY2026. Losses totaled ₹91,685 crore.
• Active retail participation declined for the first time in four years, falling 18% to 8.75 million traders.
• Options trading accounted for 92% of the total aggregate losses.
• Retail traders incurred about ₹25,000 crore in transaction costs (spreads, taxes, etc) during this period.
• Most of these traders (89%) ended the year with losses.
• 43% of traders were under 30.

Retail traders are typically underfunded for the scale of risk they assume in trading derivative instruments. SEBI’s actions appear largely driven by a desire to protect investors and maintain market stability. The target appears to be the retail segment of the market, where participation is made up of investors with limited knowledge and training.  

What are the New SEBI Intraday Trading Regulations?

Firstly, a clear distinction now exists between equity-cash intraday trading and intraday futures and options (F&O) trading. Under the new rules, intraday trading remains legal, but brokers, exchanges, and market participants will now be subject to leverage limits.

1. Intraday position-limit monitoring

Equity derivatives (i.e., stock CFDs) will now be subject to intraday monitoring of position limits. To this end, exchanges will actively monitor clients’ positions during the active trading session. This replaces the previous practice of relying on end-of-day checks. This change aims to prevent traders or high net-worth market participants from accumulating massive positions that could create settlement risks or threaten market integrity. As part of intraday monitoring, exchanges must take multiple position snapshots throughout the trading session.  

The implication for traders is that they can no longer accumulate excessive positioning during the day and reduce it to within limits toward the market close. Any exposures must be managed actively within allowed limits throughout the trading session. SEBI’s framework also provides for monitoring of market-wide open-interest utilisation in single-stock futures, with exchanges able to take surveillance or risk-management measures when utilisation reaches specified thresholds.

2. Higher minimum contract values

SEBI has also increased the minimum contract value for index derivatives from the earlier range toward approximately ₹15 lakh–₹20 lakh. This ensures derivative contract minimum sizes match the level of risk involved.

3. Upfront option-premium collection

Another new SEBI intraday trading regulation now mandates brokers to collect option premiums upfront. This is another leverage-controlling measure that seeks to curtail excessive leverage when trading options. Traders can no longer rely on temporary intraday credit to maintain option positions. Instead, they must provide the required funds or margin collateral to initiate and maintain option positions.

4. Weekly expiry restrictions

SEBI has also revised the expiry dates for weekly index options. The expiration is now one benchmark index per exchange. This is meant to curb speculative activity concentrated during expiry sessions.

5. Additional expiry-day margin

To give traders an extra buffer against extreme price movements during high-volatility expiry sessions, SEBI introduced a 2% extreme-loss margin (ELM). This ELM covers short option positions on expiry day.

Other Points for Consideration

Unlike the US, UK, and Europe, SEBI has no mandates on intraday leverage figures for stocks. SEBI has opted to stay away from this realm. Instead, intraday buying power depends on the market segment, the asset traded, the exchange’s margin requirements, and broker-related risk-management policies. Brokers can also remove products when volatility increases or adjust leverage for products likely to see high volatility at certain times.

Therefore, traders should make a clear distinction between the leverage requirements for individual brokers (not SEBI-mandated) and the updated SEBI intraday trading regulations.

Conclusion

SEBI’s intraday trading regulations do not ban intraday trading. They change how traders should approach it. The new rules mean traders must move away from strategies that depend on high leverage toward strategies that emphasize risk management, using the risk parameters defined in the regulatory update.