(Bloomberg) — Jane Road Group LLC informed its workers that India’s securities regulator made “many faulty or unsupported assertions” about its buying and selling exercise within the nation, and the agency intends to defend itself towards the accusations.
In an electronic mail to staffers over the weekend, the American proprietary buying and selling agency and market maker stated it strongly rejects the premise and substance of an interim order from the Securities and Change Board of India that accused it of “index manipulation.”
The regulator final Friday quickly barred Jane Road from accessing India’s securities market, and stated it could seize 48.4 billion rupees ($564 million) in alleged “illegal features.” Jane Road made the equal of about $4.3 billion in general buying and selling features between January 2023 and March 2025, in response to SEBI.
“We reject the premise and the substance of the Order within the strongest doable phrases,” Jane Road stated. “It’s deeply upsetting to see the agency mischaracterized on this approach,” it added.
The agency stated SEBI’s report used extraordinarily inflammatory language and was “basically mistaken” about Jane Road’s trades. It’s getting ready a proper response to the regulator and likewise assessing its authorized choices. SEBI didn’t instantly reply to a request for touch upon Tuesday.
SEBI had stated the agency had disregarded makes an attempt by the regulator and exchanges to vary its conduct — which Jane Road additionally disputed in its electronic mail.
The agency stated it had sought to interact with SEBI and had been responding to its queries since August 2024. Jane Road additionally stated that after receiving letters from two Indian inventory exchanges in February this yr, it turned off buying and selling till it might higher perceive their issues.
Senior Jane Road leaders from Hong Kong and New York flew to Mumbai and met with representatives of the Nationwide Inventory Change of India Ltd. Following that, the agency made adjustments to its buying and selling “to handle their preferences,” it stated.
“Since February, we have now made ongoing efforts to speak with SEBI and have been constantly rebuffed,” it stated, including that the regulator didn’t reply to the agency’s requests to debate their issues.
SEBI’s 105-page report listed numerous cases of what it alleged was index manipulation by Jane Road.
It stated that on Jan. 17, 2024, the agency had traded aggressively to push up the underlying money and futures market costs on the day that weekly index choices tied to the NSE Nifty Financial institution Index have been expiring. It stated Jane Road heaped on massive quantities of bearish choices trades, and subsequently reaped massive earnings from unwinding some positions and letting others expire.
Jane Road stated that what the regulator referred to as “intraday index manipulation” was an instance of primary index arbitrage buying and selling, which the agency stated was widespread in monetary markets and a strategy to convey costs of associated devices consistent with one another.
It stated there was a big divergence between the worth of the Nifty Financial institution Index within the choices markets and within the inventory market on that day in January 2024, and Jane Road traded “in a route in step with closing that hole.”
SEBI’s allegations of index manipulation “constantly mirror a misunderstanding of normal hedging practices and the interrelationships between by-product and underlying markets,” Jane Road stated.
The agency stated its buying and selling exercise is “unambiguously good for the well being of monetary markets: within the absence of individuals like Jane Road, there can be no financial hyperlink between the Indian derivatives market and the underlying economic system,” the e-mail stated.
“We take delight within the position we serve in markets around the globe, and it’s painful to have our agency’s repute tarnished by a report primarily based on so many faulty or unsupported assertions,” it informed workers. “You all need to really feel pleased with your work right here.”
–With help from Chiranjivi Chakraborty.
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