SEBI examining Feasibility of Intangibles

Published on August 01, 2019
Current context: SEBI will examine the feasibility of allowing derivative contracts based on intangibles (like weather or freight) in Indian commodity segment.
SEBI examining Feasibility of Intangibles 
  • With this, SEBI is attempting to make the commodity segment more efficient and investor-friendly.
  • SEBI will also look into an exchange-traded fund (ETF is market security that tracks an index, bond, basket of assets or commodity, In this case, ETF is a commodity).
  • It will increase the hedger’s participation and increase delivery based settlement.
  • A five-member working group constituted to look at a specific issue related to the commodity segment, will submit a report to the Commodity Derivatives Market Regulatory Department (CDMRD) by August.
  • After which SEBI will forward selected proposal to Commodity Derivatives Advisory Committee (CDAC) for final screening after which it will be submitted to SEBI board.

Question: 

Q.1 What is the opposite of hedger in the derivative market or who complements hedger in derivative market?
a. Buyer
b. Seller
c. Speculator
d. Investor

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