Can NRI do option trading?

Yes, NRIs can trade in Options & Futures (F&O), but only through an NRO (Non-PIS) trading account.

However, the RBI & SEBI impose strict regulations, which NRIs must follow.

Rules for NRI Option Trading in India

Only via NRO (Non-PIS) Account

• NRIs cannot trade options using an NRE account.
• An NRO trading & Demat account is required for F&O trading.

No PIS Approval Needed

• Unlike equity trading, F&O trading does not require PIS (Portfolio Investment Scheme) approval from the RBI.

Mandatory CP Code (Custodial Participant Code)

• NRIs must obtain a CP Code from a registered clearing member (custodian).
• CP Code acts as a unique identifier for F&O trades.

100% Margin Requirement

• NRIs cannot trade on margin or leverage like resident traders.
• They must maintain 100% cash or equivalent collateral for F&O positions.

No Intraday or Short Selling

• NRIs cannot do intraday trading in options.
• They must take delivery-based settlement (i.e., hold till expiry or square off before expiry).