Why Zerodha and Groww investing in MSEI?

chethan

User: Confused_Retail_Trader
Subject: Why Zerodha and Groww investing in MSEI?
I dont understand why big brokers like Zerodha and Groww are investing in MSEI which is making losses every year. What is their strategy? Are they planning something that we dont know?

chethan

Reply by: Market_Strategist_Pro
After SEBI limited weekly expiries on NSE, MSEI provides alternative platform for derivative trading. By acquiring stake, these players can facilitate and influence introduction of similar products that were previously offered by NSE, thereby attracting significant volume of trade. Think about it - weekly options trading volume is huge and if some of that shifts to MSEI these brokers will benefit.

chethan

Reply by: Skeptical_Investor_123
This is conflict of interest if you ask me. Exchange is second level of regulatory oversight after SEBI where retail traders can file complaints against brokers. But when brokers own part of exchange, how can retail traders expect justice? I am not comfortable with this arrangement at all. SEBI should look into this issue.

chethan

You guys are too negative. This investment will bring technology and resources to MSEI. Move reflects MSEI's intent to attract reputed investors and build trust by bringing in industry leaders like Groww, Zerodha, and Share India. More competition among exchanges is good for market. NSE and BSE have dominated for too long, MSEI can provide alternative.