Jane Street, a US Firm, Earns More than $2.3 Billion in India; Faces Investigation by SEBI
SEBI Launches Investigation into Jane Street’s Derivatives Trading
US-based Jane Street Group has come under scrutiny by the market regulator Securities and Exchange Board of India (SEBI) after reportedly earning over $2.3 billion in net revenue from Indian equity derivatives in 2024. The firm is facing allegations of market manipulation following a sharp rise in its trading activities in India compared to the previous year. Jane Street, a New York-based trading giant, earned more than 10% of its record global trading revenue of $20.5 billion from India alone.
SEBI Probing Allegations of Market Manipulation
SEBI initiated the probe into Jane Street’s derivatives trading after receiving complaints from market participants accusing the firm of manipulation. While a separate investigation by the National Stock Exchange (NSE) concluded last month, SEBI is continuing its scrutiny into Jane Street’s practices in the Indian market. The firm has refrained from commenting on both the ongoing probe and its significant revenue generated from India.
Booming Options Trading Market in India
Options trading in India has experienced a surge in activity, especially following the COVID-19 pandemic. With the country now boasting the world’s largest derivatives market in terms of contracts traded, global firms like Citadel Securities and Optiver have also entered the Indian market to capitalize on its growth. Between 2020 and March 2025, options premiums in India have risen substantially, driven primarily by retail investors.
Jane Street’s Unique Trading Strategy
According to SEBI, companies trading through Jane Street reaped approximately $7 billion in profits in the year leading up to March 2024. Jane Street’s success can be credited to its innovative technology-based trading style and the utilization of its proprietary capital for trading, allowing for more flexibility compared to traditional banking restrictions. The firm’s strategic approach, including a special “secret” trading strategy, has enabled it to earn significant profits, with a notable $1 billion from trading options in India in 2023.
SEBI’s Protective Measures for Retail Investors
SEBI has recently implemented new regulations aimed at safeguarding retail investors in the options market, where a significant portion of investors have experienced losses. With higher investment limits and larger lot sizes introduced in November, the regulatory authority aims to mitigate risks and ensure a more stable trading environment for retail participants. As a result, growth in NSE’s options trading fees has seen a significant slowdown compared to the previous year.
