Jane Street Scandal Triggers 35% Crash In NSE Index Options Premium Turnover
Jane Street's Sebi ban has triggered a 35% crash in NSE's index options premium turnover; Details
Jane Street Scandal: The National Stock Exchange (NSE) is feeling the heat from the Securities and Exchange Board of India's (Sebi) explosive market manipulation case against US-based trading powerhouse Jane Street. The impact has been swift and severe, with index options premium turnover plunging by more than a third. The exchange is grappling with the absence of one of its most dominant players.
On Thursday's weekly expiry (July 17), NSE index options premium turnover stood at Rs 39,625.77 crore — a sharp 35% drop compared to the June expiry-day average of Rs 60,605 crore, according to exchange data.
This decline has been building steadily. From Rs 61,511 crore on the July 3 expiry, volumes slumped to Rs 45,884 crore last week, before crashing below the critical Rs 40,000 crore mark in the latest session.
Index options premium turnover is widely regarded as a barometer of active risk-taking and real capital deployment in the derivatives market. Expiry Thursdays typically see the highest trading volumes, making the recent fall even more striking.
The turmoil stems from Sebi's interim ban on Jane Street, a global leader in high-frequency and algorithmic trading. The regulator accused the firm of large-scale manipulation in the Indian derivatives market, particularly on index options expiry days. Sebi's probe found that Jane Street consistently took outsized risks across F&O segments — risks that, in 'cash equivalent' terms, dwarfed those of any other player in the ecosystem.
Sebi described the scale and intensity of Jane Street's activity as 'manipulative," highlighting the firm's use of stock and index futures, as well as cash equities, to allegedly move market prices in its favor, at times accepting losses in one segment to unlock outsized gains in options trading. Over the period under investigation, Jane Street is estimated to have netted profits of Rs 36,502.12 crore across all market segments.
In an attempt to regain access to Indian markets, Jane Street last week deposited Rs 4,843.58 crore into an escrow account, in line with Sebi's directives. The firm has requested partial relief from the interim order, asking the regulator to lift certain restrictions following the escrow arrangement. Sebi has said it is reviewing the request.
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July 18, 2025, 13:19 IST
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