SEBON proposes phased introduction of Intraday Trading

The Securities Board of Nepal (SEBON) has proposed introducing intraday trading in the capital market on a phased basis, with the initial focus on investor protection, risk management and market transparency.

The regulator’s proposed framework aims to improve market liquidity and price discovery while supporting the development of modern capital market infrastructure. SEBON plans to initially allow intraday trading only in a limited number of regularly traded and sufficiently liquid securities with comparatively lower risks of market abuse.

Under the first phase, SEBON has proposed a “Buy First, Sell Later” model, allowing investors to purchase shares and sell them within the same trading day. The “Sell First, Buy Later” model would be considered only after adequate infrastructure for securities lending and borrowing and covered short selling has been established.

Before implementation, SEBON plans to establish eligibility criteria for securities and investors, broker operating procedures, risk-disclosure requirements, margin and risk-management mechanisms, market-surveillance systems and the necessary technological infrastructure. Testing and readiness assessments would precede a phased rollout, with the scope expanded based on experience and risk assessments.

SEBON said the concept paper was developed following discussions involving representatives from SEBON, Nepal Stock Exchange (NEPSE), CDS and Clearing Limited, and the Stock Brokers Association of Nepal. Stakeholders have been invited to submit feedback on the proposed framework.