IREDA, Tata Technologies to Enter F&O Segment from March Series

Two more stocks, Indian Renewable Energy Development Agency (IREDA) and Tata Technologies, will be added to India’s fast-growing futures and options (F&O) segment from the March series, according to a National Stock Exchange (NSE) circular issued on Wednesday.

These additions follow the earlier inclusion of four stocks—NBCC, Phoenix Mills, Solar Industries, and Torrent Power—announced on January 30.

With these new inclusions, traders and investors will have more choices in the derivatives market starting February 28, when the March F&O series begins. The current February series is set to expire on February 27.

Understanding Derivatives Trading

Derivatives trading involves the buying and selling of financial contracts that derive their value from underlying assets such as stocks, indices, currency pairs, or commodities.

Unlike spot trading, where investors take direct ownership of securities, derivatives allow traders to speculate on price movements without holding the asset, making it a riskier yet potentially high-reward market segment.

Simply put, derivative contracts gain their prices from fluctuations in the values of the underlying assets.

SEBI’s Caution on F&O Trading Risks

The Securities and Exchange Board of India (SEBI) has repeatedly highlighted the risks associated with F&O trading.

Over the years, the market regulator has conducted studies and released reports warning investors—particularly retail traders—about the volatility and speculative nature of derivatives markets.

In a study released last year, SEBI found that nearly seven out of ten intraday traders in FY23 incurred losses, underscoring the high-risk nature of the segment.

Many market experts continue to caution new investors against engaging in intraday and leveraged trading without a proper risk assessment.

Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. This does not constitute a personal recommendation/investment advice. It does not aim to influence any individual or entity to make investment decisions. Recipients should conduct their research and assessments to form an independent opinion about investment decisions.

Investments in the securities market are subject to market risks, read all the related documents carefully before investing.