Business Standard – Markets

Market Regulator Sebi Floats Proposal to Revamp ETF Price Band Framework

The Securities and Exchange Board of India (SEBI) has issued a consultation paper proposing a overhaul of ETF price‑band rules. It recommends moving the base‑price reference from T‑2 closing NAV to T‑1 data or recent indicative NAV, and introducing dynamic, asset‑specific bands. Under the plan, equity and debt index ETFs would start with a 10% band that can expand to 20%, commodity ETFs linked to gold and silver would begin at 6% with a 20% daily cap, and overnight ETFs would keep a 5% band. The change aims to align trading ranges with underlying volatility and reduce operational risk.