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SEBI Issues New Norms for Short Selling by Institutional Investors.

Banking & Finance | Dated: 06 Jan 2026

The Securities and Exchange Board of India (SEBI) has issued a new framework for short selling in the Indian securities market. Institutional investors are now required to disclose upfront whether a transaction is a short sale at the time of placing the order. Retail investors can make this disclosure by the end of the trading day.

🎯 Key Highlights:

  • Naked short selling (selling shares without borrowing them) remains prohibited.
  • Brokers must collect details of scrip-wise short sell positions and upload them to stock exchanges daily.
  • The framework aims to increase transparency and prevent market manipulation through short positions.

💡 Other Important Facts:

  • Guideline: Short Selling Norms.
  • Prohibition: Naked Short Selling.
  • Requirement: Upfront Disclosure for Institutions.

📚 Test Your Knowledge:

According to SEBI's new norms, which type of short selling remains prohibited in the Indian securities market?

Correct Answer: Naked Short Selling

🚀 Quick Recap:

About SEBI

  • Chairperson – Madhabi Puri Buch
  • HQ – Mumbai