UPSC Prelims 2025 PYQ on India’s Stock Market and Regulation
Question:Consider the following statements :
I. India accounts for a very large portion of all equity option contracts traded globally thus exhibiting a great boom.
II. India’s stock market has grown rapidly in the recent past even overtaking Hong Kong’s at some point of time.
III. There is no regulatory body either to warn the small investors about the risks of options trading or to act on unregistered financial advisors in this regard.
Options:
Explanation:
✅ Statement I: Correct. As per NSE data and BIS reports, India has emerged as a global hub for equity derivatives. In 2023, India accounted for more than 80% of global equity index option trades, largely on the NSE.
✅ Statement II: Correct. In January 2024, India’s stock market briefly overtook Hong Kong’s to become the world’s 4th largest by market capitalization. Statement III: Incorrect. The Securities and Exchange Board of India (SEBI) regulates securities markets, issues investor warnings on risky trading (like options), and takes action against unregistered financial advisors.
