The Securities and Exchange Board of India (Sebi) has proposed enabling retail investors to participate in algorithmic trading, which has been primarily accessible to institutional investors. This move aims to enhance market efficiency and transparency,

The market regulator Securities and Exchange Board of India (SEBI) has proposed empanelment and registration of algorithmic providers and traders with the exchanges and also has asked tech-savvy retail investors to register the algorithms they have developed with the exchanges through their brokers.

The proposal, if implemented, is expected to fill in the void for retail investors who want to trade using algos with adequate safeguards.

Sebi aims to facilitate retail investors participation in algo trading, enhancing market efficiency and transparency with new safeguards.

With algos being used only by institutional investors, the refined framework is expected to fill in the gap for retail investors who want to use algos and Sebi ’s Direct Market Access (DMA) facility to take advantage of the faster order execution and improved liquidity, with proper safeguards.

India's markets regulator on Friday proposed a framework to allow retail investors to participate in algorithmic trading through stock brokers.

SEBI specified that brokers will be the primary party, while any algorithm provider, fintech firm, or vendor will act as their agent when using the broker's API.

SEBI proposes new rules to include retail investors in algorithmic trading, enhancing market participation with safeguards for transparency, risk management, and investor protection.

The facility of algo trading shall be provided by the stock broker only after obtaining requisite permission of the stock exchange for each algo, says SEBI