UPSC CSE Prelims
Question 72
Consider the following statements :
- India accounts for a very large portion of all equity option contracts traded globally thus exhibiting a great boom.
- India's stock market has grown rapidly in the recent past even overtaking Hong Kong's at some point of time.
- There is no regulatory body either to warn the small investors about the risks of options trading or to act on unregistered financial advisors in this regard.
Which of the statements given above are correct?
View correct answer and explanation
Correct answer: A
Correct Option: A (I and II only)
Explanation: India became a global leader in equity-derivatives contract volumes and its market capitalisation briefly surpassed Hong Kong's. However, India's securities market is regulated, and SEBI issues investor-risk warnings and acts against unregistered advisers.
Statement / Pair / Item-wise Analysis:
I: True-India accounts for a very high share of equity-options contracts.
II: True-Indian market capitalisation overtook Hong Kong at points.
III: False-SEBI is a regulator that oversees derivatives and investment advisers.
Option-wise Analysis:
A. Correct-this matches the facts and the item-wise assessment above.
B. Incorrect-includes III despite the item-wise findings; omits I which the answer requires.
C. Incorrect-includes III despite the item-wise findings; omits II which the answer requires.
D. Incorrect-includes III despite the item-wise findings.