India’s securities regulator SEBI has clarified that its interim order against US-based Jane Street Group, involving recovery of ₹4,843.57 crore over alleged index options manipulation, is not a show cause notice and that its probe is far from over.
“This interim order is not a show-cause notice,” SEBI sources told ANI. “It only addresses manipulation on select expiry days, and the investigation into Jane Street’s trading strategies will continue.”
According to SEBI, the interim action focuses on 21 expiry days with clear prima facie evidence of manipulation — 18 involving BANKNIFTY contracts between January 2023 and March 2025, and 3 involving NIFTY in May 2025.
Sources explained that the scope of the probe is much broader. Investigators will examine trading on other expiry days, in other indices (including trades across exchanges), and any additional suspect patterns beyond those identified so far.
“It is difficult to estimate how long all this could take — the scope is quite large,” an official said.
SEBI also sought to reassure investors that it does not expect any major market disruption from its enforcement action. Officials pointed out that delta-based limits on index options are now in place to curb excessive risk-taking while protecting regular participants.
“Better enforcement of existing regulations will pave the way for sustainable market confidence and responsible investing,” the official added.
The interim order itself runs over 100 pages and details how Jane Street entities allegedly exploited price movements on expiry days to reap large profits in options while taking minor losses in cash and futures. Despite receiving caution letters from NSE in February 2025, Jane Street is accused of persisting with high-risk, market-distorting trading strategies.
SEBI expressed concern about retail participation in short-term index options, noting that around 90% of retail traders continue to lose money. Officials argue that promoting longer-term trading, hedging, and investing is vital to deepen India’s capital markets and protect small investors.
The market regulator also stressed that this action is part of its broader mandate to ensure investor protection, market stability, and capital formation.
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