Derivatives need guardrails as market grows: NSE CEO

National Stock Exchange CEO Ashishkumar Chauhan speaking at the FIA conference | Photo Credit: NSE

India’s derivatives market may need entry thresholds similar to those in global markets as participation widens and vulnerable investors slip into excessive speculation, said the National Stock Exchange CEO Ashishkumar Chauhan on Thursday.

Speaking at the FIA conference, the NSE chief said derivatives will become increasingly important as tools for risk management, even as regulators may need to step in to protect smaller investors.

“Because of technology changes bringing many other changes, including geopolitical shifts and changes in financial markets very rapidly, over the next 20, 30 or even 50 years the need for markets which allow management and transfer of risk, derivatives markets, will be needed much more,” he said.

But the growth cannot come at the cost of widespread speculative losses among those with limited financial capacity.

“A developing country like India cannot allow over-speculation by the lower strata of the economy. Hence, more and more regulations will come from governments, regulators and exchanges to curb over-speculation till the perception continues,” Chauhan said.

He suggested India could consider a minimum qualifying framework for derivatives participation, similar to norms in countries such as Singapore and the United States.

“Most countries have already adopted this regime and it is high time India adopts it so that the protection required for the lower strata is adequately provided and government objectives are fulfilled,” he added.

Published on February 26, 2026